Untitled

graph LR
    subgraph "Residency & POEM"
        A[Start] --> B{Individual/Company}
        B -- Resident --> C[Taxed on Global Income]
        B -- Non-Resident --> D[Taxed on Indian Income]
        E[Company Residency] --> F{Pre-POEM: Based on Incorporation/Mgmt Location}
        F --> G[Potential for Tax Avoidance]
        E --> H{POEM (2016): Based on Place of Effective Management}
        H --> I[Focus on Actual Control & Decision Making]
        G --> J[End]
        I --> J
    end

    subgraph "BEPS"
        K[Start] --> L[Multinational Companies]
        L --> M{Exploit Gaps in Tax Rules}
        M --> N[Profit Shifting]
        N --> O[Transfer Pricing, IP Migration, Debt Financing]
        O --> P[Base Erosion & Profit Shifting (BEPS)]
        P --> Q[OECD Inclusive Framework]
        Q --> R[Global Efforts to Counter BEPS]
        R --> S[End]
    end

    subgraph "DTAAs"
        T[Start] --> U[Double Taxation]
        U -- Juridical --> V[Same Income taxed by 2 Jurisdictions]
        U -- Economic --> W[Same Economic Activity taxed twice]
        V --> X[DTAA (Bilateral Treaty)]
        W --> X
        X -- Exemption Method --> Y[One country exempts income]
        X -- Credit Method --> Z[Tax credit for taxes paid elsewhere]
        Y --> AA[End]
        Z --> AA
    end

    subgraph "Global Minimum Tax"
        AB[Start] --> AC[Tax Competition (Race to the Bottom)]
        AC --> AD[Need for Minimum Tax]
        AD --> AE[OECD Proposal: 15% Minimum Tax]
        AE --> AF[Income Inclusion Rule (IIR)]
        AE --> AG[Undertaxed Profits Rule (UTPR)]
        AF --> AH[End]
        AG --> AH
    end

    subgraph "Two-Pillar Solution"
        AI[Start] --> AJ[Digital Economy Tax Challenges]
        AJ --> AK{Pillar One: Profit Reallocation}
        AJ --> AL{Pillar Two: Global Minimum Tax}
        AK --> AM[For Large MNEs with Market Presence]
        AL --> AN[15% Minimum Tax]
        AM --> AO[Challenges in Implementation]
        AN --> AO
        AO --> AP[End]
    end

    subgraph "Transfer Pricing"
        AQ[Start] --> AR[Transactions between Related Entities]
        AR --> AS[Potential for Profit Shifting]
        AS --> AT[Transfer Pricing Manipulation]
        AT --> AU[Arm's Length Principle]
        AU --> AV[Regulations to Ensure Fair Pricing]
        AV --> AW[End]
    end

    subgraph "Indirect Transfers"
        AX[Start] --> AY[Transfer of Ownership of Parent Company]
        AY --> AZ[Indirect Transfer of Subsidiary]
        AZ --> BA[Potential for Tax Avoidance]
        BA --> BB[Vodafone Case Example]
        BB --> BC[Policy Changes to Address Indirect Transfers]
        BC --> BD[End]
    end

    subgraph "Cess vs. Surcharge"
        BE[Start] --> BF[Tax on Base Tax Liability]
        BF -- Specific Purpose --> BG[Cess]
        BF -- Additional Charge on Tax + Cess --> BH[Surcharge]
        BG --> BI[Clear Objectives]
        BH --> BJ[Objectives may not be clear]
        BG --> BK[Not shared with states]
        BH --> BL[Generally not shared with states]
        BI --> BM[End]
        BJ --> BM
        BK --> BM
        BL --> BM
    end