Tax Haven Activities and the Tax Liabilities of Multinational Groups
AbstractThis paper investigates the effect of tax haven operations on the tax liabilities of corporate groups headquartered in 15 OECD countries. Using consolidated accounting data from ORBIS (2003-2007), this work finds that, at the mean, an additional tax haven subsidiary reduces tax liabilities over total assets by 7.4 per cent in the long run. At the mean, the marginal effective tax rate (ETR) of a corporate group with tax haven subsidiaries is one percentage point lower than it is for groups without low-tax offshore operations. The results also show that the marginal ETR of companies headquartered in countries with a territorial system is lower than that of companies headquartered in jurisdictions with a worldwide system of taxation on corporate profits. More specifically, corporate groups headquartered in the United States have the highest marginal ETR.
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Bibliographic InfoPaper provided by Oxford University Centre for Business Taxation in its series Working Papers with number 0925.
Date of creation: 2009
Date of revision:
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More information through EDIRC
Corporate Income Tax; Multinationals; Profit shifting; Tax Havens;
Find related papers by JEL classification:
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
- H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
- H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm
This paper has been announced in the following NEP Reports:
- NEP-ACC-2009-11-07 (Accounting & Auditing)
- NEP-ALL-2009-11-07 (All new papers)
- NEP-PBE-2009-11-07 (Public Economics)
- NEP-PUB-2009-11-07 (Public Finance)
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.:
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