Conduit Entities: Implications of Indirect Tax-Efficient Financing Structures for Real Investment
AbstractAs well known, companies shift income from high to low tax jurisdictions. Typically, profit shifting is achieved by "direct" financing structures whereby companies use debt finance in the high tax entity and equity finance in the low tax entity. However, certain tax policies can lead to "indirect" financing structures whereby a conduit entity provides an opportunity to achieve at least two deductions for interest expenses for an investment made in the host country. The effect of "direct" and "indirect" financing structures on real investment is compared.
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Bibliographic InfoArticle provided by Springer in its journal International Tax and Public Finance.
Volume (Year): 11 (2004)
Issue (Month): 4 (08)
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Web page: http://www.springerlink.com/link.asp?id=102915
Other versions of this item:
- Jack M. Mintz, 2003. "Conduit Entities: Implications of Indirect Tax-Efficient Financing Structures for Real Investment," International Tax Program Papers 0410, International Tax Program, Institute for International Business, Joseph L. Rotman School of Management, University of Toronto, revised Sep 2004.
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
- H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
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