Abstract

CASTRO ARANGO, José Manuel. Hidden capitalization in 2012's Colombian tax reform: A legal transplant or a legal monstrosity. Rev. Derecho Estado [online]. 2013, n.31, pp.161-190. ISSN 0122-9893.

Abstract Colombia has established some rules attempting to fight undercapitalization following international trends. However, trying to "transplant" the rules, the Congress has neglected the details and it has forgotten to "acclimate" them to Colombian context. As a result, today all the companies thinking to finance a project should consider the general anti-abuse rule, the transfer pricing rules and the thin capitalization rule. Due to their wording, it is possible an overlapping of those rules on a fact. The goal of this article is to analyze the relation among these rules. The analysis concludes the thin capitalization rule is a "monstrosity", which only could be coherent with the constitution alprinciple of justice in taxation and the arm's length principle stated in dtc's if the norm is considered as a rebuttable presumption.

Keywords : international Fiscal Law; tax fraud; thin capitalization; transfer pricing; arm'slength principle; double taxation conventions.

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