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Overview of the Characteristics of Tax Haven

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  • Dhammika Dharmapala

Abstract

Tax havens have become a subject of great interest among policymakers, scholars and the general public, and are central to many important current policy debates. This chapter provides an overview of the scholarly literature on the characteristics and origins of tax havens. The earlier literature, used cross-country analysis and found evidence that tax havens tend to have stronger governance institutions than comparable nonhaven countries. The more recent literature analyses the historical origins of tax havens and undertakes longitudinal analysis of their adoption of haven-like laws. This chapter also presents a descriptive analysis of the relationship between tax haven status and quantitative measures of countries’ historical characteristics. This descriptive analysis suggests that tax haven jurisdictions are not appreciably different from nonhavens in their historical experience of foreign rule and in other historical characteristics. This suggests some caution in attributing tax havens’ status to their colonial history or to other historical variables.

Suggested Citation

  • Dhammika Dharmapala, 2023. "Overview of the Characteristics of Tax Haven," CESifo Working Paper Series 10411, CESifo.
    • Handle: RePEc:ces:ceswps:_10411
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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp10411.pdf
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    References listed on IDEAS

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    1. Dhammika Dharmapala, 2021. "A New Measure Of Foreign Rule Based On Genetic Distance," Economic Inquiry, Western Economic Association International, vol. 59(2), pages 622-647, April.
    2. Mark Dincecco & Mauricio Prado, 2012. "Warfare, fiscal capacity, and performance," Journal of Economic Growth, Springer, vol. 17(3), pages 171-203, September.
    3. Daron Acemoglu & Simon Johnson & James A. Robinson, 2001. "The Colonial Origins of Comparative Development: An Empirical Investigation," American Economic Review, American Economic Association, vol. 91(5), pages 1369-1401, December.
    4. Kaufmann, Daniel & Kraay, Aart & Mastruzzi, Massimo, 2005. "Governance matters IV : governance indicators for 1996-2004," Policy Research Working Paper Series 3630, The World Bank.
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    8. 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.
    9. Shafik Hebous, 2014. "Money at the Docks of Tax Havens: A Guide," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 70(3), pages 458-485, September.
    10. Casi, Elisa & Spengel, Christoph & Stage, Barbara M.B., 2020. "Cross-border tax evasion after the common reporting standard: Game over?," Journal of Public Economics, Elsevier, vol. 190(C).
    11. Dharmapala, Dhammika, 2016. "Cross-border tax evasion under a unilateral FATCA regime," Journal of Public Economics, Elsevier, vol. 141(C), pages 29-37.
    12. James R. Hines & Eric M. Rice, 1994. "Fiscal Paradise: Foreign Tax Havens and American Business," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 109(1), pages 149-182.
    13. Dharmapala, Dhammika & Hines Jr., James R., 2009. "Which countries become tax havens?," Journal of Public Economics, Elsevier, vol. 93(9-10), pages 1058-1068, October.
    14. Dhammika Dharmapala, 2008. "What problems and opportunities are created by tax havens?," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 24(4), pages 661-679, winter.
    15. James R. Hines Jr., 2005. "Do Tax Havens Flourish?," NBER Chapters, in: Tax Policy and the Economy, Volume 19, pages 65-100, National Bureau of Economic Research, Inc.
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    17. Pritish Behuria, 2023. "The political economy of a tax haven: the case of Mauritius," Review of International Political Economy, Taylor & Francis Journals, vol. 30(2), pages 772-800, March.
    18. Joel Slemrod, 2008. "Why Is Elvis on Burkina Faso Postage Stamps? Cross‐Country Evidence on the Commercialization of State Sovereignty," Journal of Empirical Legal Studies, John Wiley & Sons, vol. 5(4), pages 683-712, December.
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    More about this item

    Keywords

    tax havens; international taxation; colonial history; governance; economic development; comparative economics;
    All these keywords.

    JEL classification:

    • H87 - Public Economics - - Miscellaneous Issues - - - International Fiscal Issues; International Public Goods
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General

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