This text provides an introduction to the policies that countries seek to advance with their international tax rules, with numerous examples drawn from the practices of both developed and developing countries. It grew out of the authors' work with the OECD in conducting seminars on international tax for tax officials in countries emerging from the collapse of the Soviet Union. The book emphasizes tax treaties and other co-operative arrangements that countries employ to co-ordinate their income tax systems with the tax systems of their trading partners, aiming to strike a balance between the specific and the general by illustrating the fundamental principles and structure of international tax with frequent reference to actual practice in a variety of countries. It should work as both an introduction and a refresher in an area where issues often prove more complex than they seem and where a return to the basics is often the most helpful means of untangling a multi-layered problem. The second edition provides updates for recent developments and expands the coverage by providing many new examples. A chapter dealing with harmful tax competition, hybrid entities, and the taxation of e-commerce has been added to the book.