Country-by-Country Reporting: Tension between Transparency and Tax Planning

Evers, Maria Theresia; Meier, Ina; Spengel, Christoph

doi:10.2139/ssrn.2913474

Cited by 18 publications

(17 citation statements)

References 15 publications

(15 reference statements)

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“…In addition, Hanlon notes that the limitations of the country by country reporting data may not be well understood, leading to misuse by tax authorities. Evers et al (2017) argue that the benefits of country by country reporting lack a theoretical foundation and do not appear to outweigh the costs. They contend that legislative solutions dealing with the gaps in tax law are preferable as a strategy for constraining unacceptable tax avoidance.…”

Section: Country By Country Reportingmentioning

confidence: 98%

Corporate tax avoidance: is tax transparency the solution?

Oats

Tuck

2019

Accounting and Business Research

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Corporate tax avoidance has been a matter of considerable public attention, particularly since the 2008 global financial crisis. The nature of calls for tax reform and increased regulation, advocated most prominently by tax activists and NGOs, has revolved around transparency as a possible corrective to unacceptable tax avoidance, although there is no consensus as to what the term tax avoidance encompasses and when it becomes unacceptable. We examine two responses to calls for increased transparency about the tax affairs of multinational entities: firstly, country by country reporting that provides information to tax authorities, and secondly the UK requirement for publication of tax strategies, whereby large companies put information into the public domain. We find considerable misunderstanding about the benefits of transparency in this setting. By failing to consider the limits of transparency initiatives there is a risk of dysfunctional consequences, for example additional costs in providing and processing additional information, the prospect of increased disputes as new information generates new misinterpretations and uncertainty in determining the final tax position. There is a risk that greater disclosure will not effectively address concerns about unacceptable corporate tax avoidance.

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Section: Country By Country Reportingmentioning

confidence: 98%

Corporate tax avoidance: is tax transparency the solution?

Oats

Tuck

2019

Accounting and Business Research

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“…Finally, investors might also expect the new disclosure rule to impose additional costs on the companies. Apart from direct costs for an initial adjustment of the reporting system and for the annual compilation of the reports, companies may also face considerable indirect costs in the form of reputational damages from being potentially blamed to engage in aggressive tax planning (Evers et al, 2017).…”

Section: Prior Literature and Hypothesesmentioning

confidence: 99%

“…Up to now, there are mostly normative contributions on possible costs and benefits of the disclosure requirement (e.g. Cockfield & McArthur, 2015;Evers et al, 2017) and some upcoming empirical analyses of its impact on corporate tax avoidance (Overesch & Wolff, 2017). We aim to complement this by providing evidence on how investors perceive the new legislation.…”

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confidence: 99%

Increasing tax transparency: investor reactions to the country-by-country reporting requirement for EU financial institutions

Dutt

Ludwig

Nicolay

et al. 2019

Int Tax Public Finance

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We employ an event study methodology to investigate the stock price reaction around the day of the political decision to include a country-by-country reporting obligation for EU financial institutions. We do not find significant abnormal returns for the banks affected. Sample splits according to the effective tax rate and the degree of B2C orientation do not reveal a more pronounced negative investor response for banks engaging more strongly in tax avoidance or being potentially more concerned about reputational risks, respectively. We conclude that the implementation of a CbCR requirement for EU financial institutions did not trigger a noticeable investor response. Contrary prior findings regarding other public tax disclosure obligations might be driven by the distinct motivation of the rules and the way the information is presented. We contend that capital market reactions to an upcoming increase in tax transparency are not generalizable to other industries and settings, but that consideration must be given to the context and the exact design of the rule.

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“…Deliberations on corporate tax planning in the light of new accounting standards are shown in the article [15]. The contradiction between transparency and tax planning are studied in the research [16]. The image of a perfect tax consultant is covered in the article [17].…”

Section: Analysis Of the Latest Research And Publicationsmentioning

confidence: 99%

Evaluation of the Russian Federation Tax Consulting Market Territorial Concentration Level

Kerimov¹,

Kadzhametova²,

Mustafaeva³

2020

Proceedings of the International Scientific Conference "Far East Con" (ISCFEC 2020)

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The article presents further development of the scientific and methodological evaluation of the level of the territorial concentration of the tax consulting market. A basic evaluation scale is proposed for the level of the territorial concentration of the tax consulting market that identified 6 intervals of the territorial concentration of the tax consulting market: absolute territorial deconcentration, low territorial concentration, medium territorial concentration, high territorial concentration, elevated territorial concentration, absolute territorial concentration of the tax consulting market. An evaluation scale for the level of territorial concentration for a tax consulting market in the Russian Federation was developed. An evaluation of the level of territorial concentration for a tax consulting market in the Russian Federation was conducted. It has been established that the tax consulting market in the Russian Federation is characterised by a low level of territorial concentration. The employed approach will allow to address the important scientific problem associated with the complex evaluation of the tax consulting market.

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Country-by-Country Reporting: Tension between Transparency and Tax Planning

Cited by 18 publications

References 15 publications

Corporate tax avoidance: is tax transparency the solution?

Corporate tax avoidance: is tax transparency the solution?

Increasing tax transparency: investor reactions to the country-by-country reporting requirement for EU financial institutions

Evaluation of the Russian Federation Tax Consulting Market Territorial Concentration Level

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