Taxes apply internationally AND cover MNCs.
Riza ’13 [Limor; Senior Lecturer of Law, Faculty of Law at Ono Academic College; Houston Business and Tax Law Journal, “Should Tax Law Mind Minority and Monitor Majority: The Case of Undistributed Dividends and the Ability-To-Pay Principle,” vol. 13]
A different approach to the justification of two-tier taxation was offered by Avi-Yonah, who has justified the concept of corporate taxation as a controlling mechanism for restraining excessive power held by contemporary corporations. 114 He claims that the normative concept of corporate income taxes has grown alongside the development of the corporate forms but those concepts ignored corporate changes. 115 He claims that corporations in our new world encompass wealth and power, and therefore, corporate tax should be justified on a regulatory basis. 116 Corporate tax may assist in controlling the massive power held by corporate managers. 117 Avi-Yonah, thus, argues that corporate tax can discipline managers operating multinational corporations. 118
<<FOOTNOTE 117 BEGINS>>
Id. at 1244-45 (claiming that the common local non-tax regulations do not have an impact on multinational corporations which carry out their business abroad. Common regulatory power has local influence but not a global one. Tax laws, on the other hand, have the power to serve as a regulatory mechanism for national and international activities and organizations. Tax laws embracing the well-recognized residence principle subject those corporations to the local supervision).
<<FOOTNOTE 117 ENDS>>