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Does Exchange of Information Between Tax Authorities Influence Multinationals' Use of Tax Havens?

Listed author(s):
  • Braun, Julia
  • Weichenrieder, Alfons

Since the mid-1990s, countries offering tax systems that facilitate international tax avoidance and evasion have been facing growing political pressure to comply with the internationally agreed standards of exchange of tax information. Using data of German investments in tax havens, we find evidence that the conclusion of a bilateral tax information exchange agreement (TIEA) is associated with fewer operations in tax havens and the number of German affiliates has on average decreased by 46% compared to a control group. This suggests that firms invest in tax havens not only for their low tax rates but also for the secrecy they offer.

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File URL: https://www.econstor.eu/bitstream/10419/113121/1/VfS_2015_pid_512.pdf
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Paper provided by Verein für Socialpolitik / German Economic Association in its series Annual Conference 2015 (Muenster): Economic Development - Theory and Policy with number 113121.

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Date of creation: 2015
Handle: RePEc:zbw:vfsc15:113121
Contact details of provider: Web page: http://www.socialpolitik.org/
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