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International Taxation and Cross-Border Banking

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  • Huizinga, H.P.

    (Tilburg University, School of Economics and Management)

  • Voget, J.

    (Tilburg University, School of Economics and Management)

  • Wagner, W.B.

    (Tilburg University, School of Economics and Management)

Abstract

This paper examines empirically how international taxation affects the volume and pricing of cross-border banking activities for a sample of banks in 38 countries over the 1998?2008 period. International double taxation of foreign-source bank income is found to reduce banking-sector FDI. Furthermore, such taxation is almost fully passed on into higher interest margins charged abroad. These results imply that international double taxation distorts the activities of international banks, and that the incidence of international double taxation of banks is on bank customers in the foreign subsidiary country.
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Suggested Citation

  • Huizinga, H.P. & Voget, J. & Wagner, W.B., 2011. "International Taxation and Cross-Border Banking," Other publications TiSEM 314f859c-46d4-4543-9479-f, Tilburg University, School of Economics and Management.
    • Handle: RePEc:tiu:tiutis:314f859c-46d4-4543-9479-febce6adef1b
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    More about this item

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • H87 - Public Economics - - Miscellaneous Issues - - - International Fiscal Issues; International Public Goods

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