Cleaning up the books

Also, the web of intragroup transactions and structural changes needed to achieve some THE AUTHOR OF degree of tax consolidation adds complexity and artificiality to the tax system and THIS ISSUE the business environment since the sole purpose for these business activities is to gain a tax advantage. [...] The losses of the basis the loss of Subsidiary B would wipe out the subsidiary in this situation may be utilized by the profit of Subsidiary A, leaving no taxes to be paid. [...] One of the most popular techniques to transfer profits and losses within members of a involves the artificial creation of an interest charge corporate group to reduce group-wide tax in one member of a corporate group with the liabilities. [...] Losses and other tax attributes which then lends the proceeds back to the parent 2 See Couzin (1991) for a review of the various provisions of the Canadian tax system that are most relevant to the transfer of losses among related corporations. [...] The Since Canadian corporate income tax legislation level of complexity sometimes required to achieve does not provide for group taxation, tax planners the transfer of tax losses leads to the question of use a number of strategies, such as those found in whether it was the intent of Parliament to allow for Box 2, which produce partly similar results and give corporate groups to pay tax on a consol