Effective global trade in a globalized world requires that all economic actors be subject to the same rules and that they deserve as few obstacles as possible. The WTO is the leading multilateral international trade regulator.  Your goal is to “…… A forum for negotiating agreements to reduce barriers to international trade and ensure a level playing field for all.  Their main objectives, namely raising the global standard of living through the promotion of trade in goods, services and capital, are the same as those of international taxation.  As a result, WTO treaties contain different rules on indirect taxation. On the other hand, direct taxation is officially regulated only by the agreement on subsidies and compensatory measures (SCM agreement). Nevertheless, it could be argued that direct taxes have trade-like effects similar to the barriers that the main WTO treaties aim to reduce. The motivation for this study is to ascertain whether the WTO has the power to decide on direct taxation and, if so, whether this is economically desirable.
First, I will focus on whether and to what extent WTO treaties allow the WTO to regulate direct tax legislation. I will start with the text of the WTO treaties and their interpretation by legal experts. I will then show that the WTO and its Member States recognise the WTO`s competence in direct taxation when comparing the dispute resolution body (DSB). Third, I will focus on the economic impact of my research question. First, I would like to examine whether, from an economic point of view, the inclusion of direct taxation in WTO rules would have a positive impact on WTO objectives. I will do so by referring to the scientific opinions and arguments made in comparisons to the DSB. I will also look at the scientific opinion on whether the WTO is the best supranational body for deciding this issue. As noted above, the range of WTO rules has continued to expand. This has led, among other things, to possible interference between these rules and direct taxation law.
Some of these interventions have already resulted in litigation before the DSB. However, the DSB has not made a decision in all of these cases and some potential interventions have not yet been submitted to the DSB. The NT principle of Articles III of the GATT, Article XVII of the GATS and Article 3 of the members prevents WTO members from treating nationals of other Member States less well than their own nationals.  Just as the MFN principle prohibits international taxation from distinguishing cash flows from individual WTO Member States, the NT principle prevents Member States from discriminating against their citizens and citizens of other members through internal taxation.  Direct taxation can affect the NT principle by supporting exports. Disputes between the United States and the EC over THE FSC and extraterritorial income systems (IETs) are considered extremely etherent effects.  First, the United States exempts income from the sale and leasing of “export goods” from taxation when significant portions of the transaction took place outside the United States.  The legal basis was the “Deficit Reduction Act,” which set out the rules for the FFC.