Theoretical framework of aggressive tax planning: double irish-dutch sandwich method

Tax planning is a method used by large international companies to reduce tax burdens. The most important argument used to benefit from these plans is the tax gaps between countries. For countries and companies, there is nothing illegal about using tax planning. However, if tax planning becomes a factor that causes tax loss in countries, aggressive tax planning that creates problems emerges. Because, tax planning is now used as an application that contradicts the spirit of tax law. It is noteworthy that aggressive tax planning is mostly used by major international digital companies. The Double Irish-Dutch Sandwich method is a special form of aggressive tax planning that reduces tax burden through copyright use and causes tax losses. These methods between tax avoidance and tax evasion, cause tax losses with the uncertainties they create in the economic system. One of the most important methods that countries will use to compensate their tax losses is to determine the factors causing these losses. Then, strategies to eliminate these factors need to be identified. For this reason, it is important to define the main characteristics and motivations of aggressive tax planning and Double IrishDutch Sandwich method. Countries’ own efforts are important in the fight against these methods. However, it seems difficult to achieve success without international cooperation.