The rapid development of open economy tax scrutiny for several decades differs from earlier patterns when academic research on taxation closed the national economy. The national tax system deals with the various modes of international flow of goods and capital that can significantly affect the efficiency of resource space in a unified world economy. The free movement of goods and capital across national borders has important implications for both direct and indirect taxation.
International taxation is a field of knowledge related to the international aspects of tax laws and global tax treaties. The tax is levied on residents of a specific nation living in that country and earning income from wages in the case of individuals and business income or in the case of commercial organizations and multinational corporations.