Advanced Search
MyIDEAS: Login to save this article or follow this journal

Where Will They Go if We Go Territorial? Dividend Exemption and the Location Decisions of U.S. Multinational Corporations

Contents:

Author Info

  • Altshuler, Rosanne
  • Grubert, Harry

Abstract

We approach the question of how moving to a dividend exemption system would affect the location incentives of U.S. corporations from three different angles. We start by comparing the U.S. allocation of foreign direct investment in manufacturing across low-tax versus high-tax jurisdictions with that of two major dividend exemption countries, Germany and Canada. The second section demonstrates how the effective tax rate on the typical investment in a low-tax affiliate would change under a dividend exemption system. The final approach uses data from the tax returns of U.S. multinationals to gauge how location decisions will be affected. Taken together, the analysis provides no consistent or definitive evidence that location decisions would be significantly changed if dividends were to be exempt from U.S. corporate tax.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.ntanet.org/NTJ/54/4/ntj-v54n04p787-809-where-will-they-territorial.pdf
Download Restriction: no

File URL: http://www.ntanet.org/NTJ/54/4/ntj-v54n04p787-809-where-will-they-territorial.html
Download Restriction: no

Bibliographic Info

Article provided by National Tax Association in its journal National Tax Journal.

Volume (Year): 54 (2001)
Issue (Month): n. 4 (December)
Pages: 787-809

as in new window
Handle: RePEc:ntj:journl:v:54:y:2001:i:n._4:p:787-809

Contact details of provider:
Postal: 725 15th St. NW #600. Washington, D.C. 20005-2109
Phone: (202)737-3325
Fax: (202) 737-7308
Email:
Web page: http://www.ntanet.org/
More information through EDIRC

Related research

Keywords:

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Grubert, Harry, 1998. "Taxes and the division of foreign operating income among royalties, interest, dividends and retained earnings," Journal of Public Economics, Elsevier, Elsevier, vol. 68(2), pages 269-290, May.
  2. Hines, James R. Jr., 1999. "Lessons from Behavioral Responses to International Taxation," National Tax Journal, National Tax Association, National Tax Association, vol. 52(n. 2), pages 305-22, June.
  3. Hartman, David G., 1985. "Tax policy and foreign direct investment," Journal of Public Economics, Elsevier, Elsevier, vol. 26(1), pages 107-121, February.
  4. Rosanne Altshuler & Harry Grubert, 2002. "Repatriation Taxes, Repatriation Strategies and Multinational Financial Policy," Departmental Working Papers, Rutgers University, Department of Economics 200009, Rutgers University, Department of Economics.
  5. Hines, J.R. & Rice, E.M., 1990. "Fiscal Paradise: Foreign Tax Havens And American Business," Papers, Princeton, Woodrow Wilson School - Discussion Paper 56, Princeton, Woodrow Wilson School - Discussion Paper.
  6. Grubert, Harry, 2001. "Enacting Dividend Exemption and Tax Revenue," National Tax Journal, National Tax Association, National Tax Association, vol. 54(n. 4), pages 811-27, December.
  7. Alfons Weichenrieder, 1996. "Anti-tax-avoidance provisions and the size of foreign direct investment," International Tax and Public Finance, Springer, Springer, vol. 3(1), pages 67-81, January.
  8. Assaf Razin & Joel Slemrod, 1990. "Taxation in the Global Economy," NBER Books, National Bureau of Economic Research, Inc, National Bureau of Economic Research, Inc, number razi90-1.
  9. Grubert, Harry & Mutti, John, 1991. "Taxes, Tariffs and Transfer Pricing in Multinational Corporate Decision Making," The Review of Economics and Statistics, MIT Press, vol. 73(2), pages 285-93, May.
  10. Grubert, Harry & Mutti, John, 2000. "Do Taxes Influence Where U.S. Corporations Invest?," National Tax Journal, National Tax Association, National Tax Association, vol. 53(n. 4), pages 825-40, December.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Tajika, Eiji & Nakatani, Ryota, 2008. "Welcome Home to Japan: Repatriation of Foreign Profits by Japanese Multinationals," Discussion Papers, Graduate School of Economics, Hitotsubashi University 2008-04, Graduate School of Economics, Hitotsubashi University.
  2. Harry Grubert, 2009. "MNC Dividends, Tax Holidays and the Burden of the Repatriation Tax: Recent Evidence," Working Papers, Oxford University Centre for Business Taxation 0927, Oxford University Centre for Business Taxation.
  3. Thornton Matheson & Victoria Perry & Chandara Veung, 2010. "Territorial vs. Worldwide Corporate Taxation: Implications for Developing Countries?," International Center for Public Policy Working Paper Series, at AYSPS, GSU, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University paper1316, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
  4. Mihir A. Desai & C. Fritz Foley & James R. Hines Jr., 2001. "Repatriation Taxes and Dividend Distortions," NBER Working Papers 8507, National Bureau of Economic Research, Inc.
  5. Peter J. Mullins, 2006. "Moving to Territoriality? Implications for the United States and the Rest of the World," IMF Working Papers, International Monetary Fund 06/161, International Monetary Fund.
  6. Harry Grubert, 2003. "The Tax Burden on Cross-Border Investment: Company Strategies and Country Responses," CESifo Working Paper Series, CESifo Group Munich 964, CESifo Group Munich.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:ntj:journl:v:54:y:2001:i:n._4:p:787-809. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Charmaine Wright).

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

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