In this chapter, Matti Ylönen explains how Advance Pricing Agreements and Advance Tax Rulings are used to stabilize activity in Global Wealth Chains and lower tax burdens. Ylönen describes how these tax ruling arrangements are used to lower potential tax burdens for multinational enterprises nationally and internationally. The selection of which tax ruling is appropriate depends on the capabilities and scale of the firm, which can be understood as a choice between Modular or Hierarchy forms of Global Wealth Chains. At the national level firms may deal directly with states (Hierarchy) or go through an intermediary, such as a professional tax advisory, to choose from a menu of options (Modular). At the international level the same choice is apparent, with the character of relations between states informing what opportunities are most attractive to firms.
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