IDEAS home Printed from https://ideas.repec.org/a/mup/actaun/actaun_2017065020721.html
   My bibliography  Save this article

Tax Information Exchange Influence on Czech Based Companies' Behavior in Relation to Tax Havens

Author

Listed:
  • Jan Rohan

    (Czech University of Life Sciences Prague, Faculty of Economics and Management, Department of Trade and Accounting, Kamýcká 129, 165 21 Prague 6, Czech Republic)

  • Lukáš Moravec

    (Czech University of Life Sciences Prague, Faculty of Economics and Management, Department of Trade and Accounting, Kamýcká 129, 165 21 Prague 6, Czech Republic)

Abstract

In recent years, borders between countries have been opened gradually thanks to globalization, which is reflected in minimal barriers to the movement of persons and capital. This situation could be potentially abused by taxpayers willing to shift the capital to preferential tax jurisdictions. Due to facts aforementioned, several instruments for tax administrators have been introduced. Bilateral and multilateral instruments are concluded with particular countries for the purpose of obtaining information about foreign residents staying abroad but also to avoid double taxation or double non-taxation. In recent years there has been an increased number of companies in the Czech Republic whose owners come from preferential tax jurisdiction from 12,676 up to 13,167. This paper is focused on the Czech taxpayers' reaction on concluding agreements concerning exchange of information in tax matters with preferential tax jurisdictions, the so-called "Tax havens". The Difference-in-Differences Method was carried out to predict the taxpayers' behavior. The model shows that the agreements work well as a preventive tool. If the Czech Republic concludes the agreement with the tax haven, the taxpayers lose their anonymity. This results in their relocation into tax havens that are not covered by the agreement in order to keep their anonymity.

Suggested Citation

  • Jan Rohan & Lukáš Moravec, 2017. "Tax Information Exchange Influence on Czech Based Companies' Behavior in Relation to Tax Havens," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 65(2), pages 721-726.
    • Handle: RePEc:mup:actaun:actaun_2017065020721
    DOI: 10.11118/actaun201765020721
    as

    Download full text from publisher

    File URL: http://acta.mendelu.cz/doi/10.11118/actaun201765020721.html
    Download Restriction: free of charge
    File URL: http://acta.mendelu.cz/doi/10.11118/actaun201765020721.pdf
    Download Restriction: free of charge
    File URL: https://libkey.io/10.11118/actaun201765020721?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Alex Cobham & Petr Janský & Markus Meinzer, 2015. "The Financial Secrecy Index: Shedding New Light on the Geography of Secrecy," Economic Geography, Taylor & Francis Journals, vol. 91(3), pages 281-303, July.
    2. Alex Cobham, Petr Janský, and Markus Meinzer, 2015. "The Financial Secrecy Index: Shedding New Light on the Geography of Secrecy - Working Paper 404," Working Papers 404, Center for Global Development.
    3. Lechner, Michael, 2011. "The Estimation of Causal Effects by Difference-in-Difference Methods," Foundations and Trends(R) in Econometrics, now publishers, vol. 4(3), pages 165-224, November.
    4. Braun, Julia & Weichenrieder, Alfons, 2015. "Does exchange of information between tax authorities influence multinationals' use of tax havens?," ZEW Discussion Papers 15-015, ZEW - Leibniz Centre for European Economic Research.
    5. Gabriel Zucman, 2014. "Taxing across Borders: Tracking Personal Wealth and Corporate Profits," Journal of Economic Perspectives, American Economic Association, vol. 28(4), pages 121-148, Fall.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Petr Janský & Miroslav Palanský, 2019. "Estimating the scale of profit shifting and tax revenue losses related to foreign direct investment," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 26(5), pages 1048-1103, October.
    2. Cobham, Alex & Janský, Petr, 2017. "Global distribution of revenue loss from tax avoidance - Re-estimation and country results," Working Papers 13662, Institute of Development Studies, International Centre for Tax and Development.
    3. Javier Garcia-Bernardo & Jan Fichtner & Eelke M. Heemskerk & Frank W. Takes, 2017. "Uncovering Offshore Financial Centers: Conduits and Sinks in the Global Corporate Ownership Network," Papers 1703.03016, arXiv.org, revised May 2017.
    4. Alex Cobham & Petr Janský & Chris Jones & Yama Temouri, . "An evaluation of the effects of the European Commission's proposals for the Common Consolidated Corporate Tax Base," UNCTAD Transnational Corporations Journal, United Nations Conference on Trade and Development.
    5. Petr Janský & Miroslav Palanský, 2019. "Estimating the scale of profit shifting and tax revenue losses related to foreign direct investment," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 26(5), pages 1048-1103, October.
    6. Alex Cobham & Petr Janský, 2019. "Measuring misalignment: The location of US multinationals’ economic activity versus the location of their profits," Development Policy Review, Overseas Development Institute, vol. 37(1), pages 91-110, January.
    7. Nouf Binhadab & Robert Gillanders & Thomas McCluskey, 2023. "A clean and discreet service: The role of corruption and secrecy in profit shifting by multinational firms," Journal of International Development, John Wiley & Sons, Ltd., vol. 35(7), pages 1551-1573, October.
    8. Alex Cobham & Petr Janský, 2017. "Global distribution of revenue loss from tax avoidance: Re-estimation and country results," WIDER Working Paper Series 055, World Institute for Development Economic Research (UNU-WIDER).
    9. Alex C. Michalos & P. Maurine Hatch, 2020. "Good Societies, Financial Inequality and Secrecy, and a Good Life: from Aristotle to Piketty," Applied Research in Quality of Life, Springer;International Society for Quality-of-Life Studies, vol. 15(4), pages 1005-1054, September.
    10. Päivi Karhunen & Svetlana Ledyaeva & Keith D. Brouthers, 2022. "Capital Round-Tripping: Determinants of Emerging Market Firm Investments into Offshore Financial Centers and Their Ethical Implications," Journal of Business Ethics, Springer, vol. 181(1), pages 117-137, November.
    11. Emma Galli & Ilde Rizzo & Carla Scaglioni, 2020. "Is transparency spatially determined? An empirical test for Italian municipalities," Applied Economics, Taylor & Francis Journals, vol. 52(58), pages 6372-6385, December.
    12. Sheila Killian & Philip O'Regan & Ruth Lynch & Martin Laheen & Dionysios Karavidas, 2022. "Regulating havens: The role of hard and soft governance of tax experts in conditions of secrecy and low regulation," Regulation & Governance, John Wiley & Sons, vol. 16(3), pages 722-737, July.
    13. Lucia Rossel & Brigitte Unger & Joras Ferwerda, 2022. "Shedding light inside the black box of implementation: Tax crimes as a predicate crime for money laundering," Regulation & Governance, John Wiley & Sons, vol. 16(3), pages 781-800, July.
    14. Jones, Chris & Temouri, Yama & Cobham, Alex, 2018. "Tax haven networks and the role of the Big 4 accountancy firms," Journal of World Business, Elsevier, vol. 53(2), pages 177-193.
    15. Bayer, Ralph-C. & Hodler, Roland & Raschky, Paul A. & Strittmatter, Anthony, 2020. "Expropriations, property confiscations and new offshore entities: Evidence from the Panama Papers," Journal of Economic Behavior & Organization, Elsevier, vol. 171(C), pages 132-152.
    16. Olbert, Marcel & Spengel, Christoph & Weck, Stefan, 2023. "Multinational firms in tax havens: Corporate motives, regulatory countermeasures, and recent statistics," ZEW Discussion Papers 23-036, ZEW - Leibniz Centre for European Economic Research.
    17. Ali Ahmed & Chris Jones & Yama Temouri, . "The relationship between MNE tax haven use and FDI into developing economies characterized by capital flight," UNCTAD Transnational Corporations Journal, United Nations Conference on Trade and Development.
    18. Petr Janský & Markus Meinzer & Miroslav Palanský, 2022. "Is Panama really your tax haven? Secrecy jurisdictions and the countries they harm," Regulation & Governance, John Wiley & Sons, vol. 16(3), pages 673-704, July.
    19. Valentina Gullo & Pierluigi Montalbano, 2018. "Where does “dirty” money go? A gravity analysis," Working Papers 5/18, Sapienza University of Rome, DISS.
    20. Fernando, Garcia Alvarado & Antoine, Mandel, 2022. "The network structure of global tax evasion evidence from the Panama papers," Journal of Economic Behavior & Organization, Elsevier, vol. 197(C), pages 660-684.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mup:actaun:actaun_2017065020721. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ivo Andrle (email available below). General contact details of provider: https://mendelu.cz/en/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.