GAARs ultimately boil down to the question of "did you do this rather than a more obvious transaction structure simply to pay less tax", a sort of Occam's razor.
> dangerous the idea of somebody arbitrarily deciding what _legal_ option is okay or isn't okay on a case by case basis.
This happens all the time in precedent-based systems whenever something unclear is litigated. In some sense it's what the legal system is for, and it's the very opposite of arbitrary.
> GAARs ultimately boil down to the question of "did you do this rather than a more obvious transaction structure simply to pay less tax", a sort of Occam's razor.
Okay, so it is a "just trust us" system of deciding who is breaking the law and who isn't. In that case, I'll gladly take multinationals not paying taxes over some government official arbitrarily deciding that I am avoiding taxes and should be punished. Even more so because I live in a country where that same official might be untrained, apathetic or downright corrupt.
> This happens all the time in precedent-based systems whenever something unclear is litigated.
It is not arbitrary. If you're in a corrupt system, you're vulnerable even if you have followed the rules. GAAR systems generally have a set of best practices, and if you disagree with the result you have access to the court system (not "a government official") to work it out.
> ...if you disagree with the result you have access to the court system (not "a government official") to work it out.
You also have access to the court in case of actual tax evasion, though I assume the odds would not exactly be in your favor.
My whole point is that you're better off avoiding the whole ordeal in the first place and that having large multinationals and governments playing whack-a-mole over the tax system is an acceptable price to pay.
GAARs ultimately boil down to the question of "did you do this rather than a more obvious transaction structure simply to pay less tax", a sort of Occam's razor.
> dangerous the idea of somebody arbitrarily deciding what _legal_ option is okay or isn't okay on a case by case basis.
This happens all the time in precedent-based systems whenever something unclear is litigated. In some sense it's what the legal system is for, and it's the very opposite of arbitrary.