Income Tax Design

3 credits · Graduate

This is an elective MBA course intended to provide a foundation in income tax frameworks. It should be of great interest to all MBA students for four main reasons. First, almost all business transactions are informed by, if not motivated and explained by, their tax consequences. (This is also the case for much human behaviour.) Second, tax is pervasive. Studying the income tax consequences of transactions such as sale and leasebacks, weak currency loans, commodity straddles, financial derivatives and corporate mergers is a good way to learn about those transactions themselves. Third, income tax frameworks are intellectually fascinating. At its most elemental level, tax involves taking one simple idea — the idea that everyone should pay tax on their income — and then applying that idea to the full panoramic variety of economic and property relations and transactions that characterize our modern, complex society. To determine each individual’s income, the infinite variety of human activity must be classified under this single rubric. Do individuals earn taxable income in the following situations: When they receive an interest-free loan from their parents? When they are awarded a scholarship? When they benefit from the use of the heavily subsidized recreational facilities at university? This course is for any student who has an interest in understanding more about the world. It will be relevant whether you work with or for small or large businesses, non-profit or charitable organizations, or whether you are simply interested in how tax frameworks apply to you personally. The course does not have a fixed disciplinary focus: it is not a course in tax accounting, tax economics or tax law. Instead, the course offers an overview about how income tax frameworks are developed by policy makers in countries around the world. Students will not leave the course with a detailed understanding of Canada’s income tax law or accounting principles – there are other courses at Dalhousie that can assist with those. Instead, you will leave this course with the ability to identify the core components of all tax law frameworks alongside the major policy decisions that country’s make in choosing how to resolve thorny questions like whether or not to allow loss consolidation, how to tax in-kind benefits received by employees, and the appropriate timing for deductions. PREREQUISITES: Core MBA courses or permission of the instructor CROSSLISTED: BUSI 6105.015 FORMATS: Discussion