Cross-Country Comparisons of Corporate Income Taxes

Markle, Kevin; Shackelford, Douglas A.

doi:10.17310/ntj.2012.3.01

Cited by 114 publications

(56 citation statements)

References 28 publications

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“…This measure of ETR has been commonly used in the literature -see e.g. Markle and Shackelford (2012) -to measure the tax burden of a firm at the consolidated level of the multinational firm. The identifying assumption is that, once key firm characteristics (such as size, industry, cash flow) are controlled for, variation in ETR particularly between multinational and domestic firms, but also within a multinational firm over time reflects the degree of profit shifting and tax-minimization strategies, particularly as conducted by large, publicly-listed firms as those in our dataset.…”

Section: Results Frommentioning

confidence: 99%

The Rise in Corporate Saving and Cash Holding in Advanced Economies:

Dao¹,

Maggi²

2018

IMF Working Papers

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Section: Results Frommentioning

confidence: 99%

The Rise in Corporate Saving and Cash Holding in Advanced Economies:

Dao¹,

Maggi²

2018

IMF Working Papers

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“…Second, tax haven incorporation provides additional opportunities for tax avoidance that may not be available to other multinational firms. Prior empirical research provides evidence that firms with tax haven parents face lower tax burdens compared to other multinational firms (Desai and Hines ; Seida and Wempe ; Markle and Shackelford ). Tax haven countries impose low or no income tax on foreign corporations, which allows firms to significantly reduce their overall tax burdens by shifting income to tax haven affiliates from operations in other countries (Dharmapala ; Dyreng and Lindsey ; Klassen and Laplante ; Markle and Shackelford, ).…”

Section: Prior Research and Development Of Hypothesesmentioning

confidence: 99%

The Complementarity between Tax Avoidance and Manager Diversion: Evidence from Tax Haven Firms

Atwood

Lewellen

2018

Contemporary Accting Res

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We investigate whether tax avoidance and manager diversion are complementary when the costs of diversion are low by comparing dividend payouts, performance, and overinvestments of tax haven firms versus other multinational firms based in countries with weak and strong investor protections. Dharmapala (2006, 2009a, b) and Desai et al. (2007) set forth a theory of tax avoidance within an agency framework (the D&D theory) based on the assumption that tax avoidance and manager diversion are complementary when the corporate governance system is "ineffec-* Accepted by Lillian Mills. We thank workshop participants at réduire les coûts du détournement pour les gestionnaires de sociétés établies dans des pays où la protection des investisseurs est faible. À l'aide d'un échantillon tiré de 28 pays de base, elles recueillent des données établissant que le détournement par les gestionnaires et l'évitement fiscal sont complémentaires pour les sociétés recourant aux paradis fiscaux qui sont établies dans des pays où la protection des investisseurs est faible, mais non pour les sociétés recourant aux paradis fiscaux établies dans des pays où la protection des investisseurs est forte. Les résultats de l'étude confirment l'hypothèse de la complémentarité sous-jacente au modèle de Desai et Dharmapala et nous éclairent sur l'incidence potentielle de la décentralisation des sociétés mondiales. Contemporary Accounting Research

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“…On the one hand, ETR is a widely used measure in evaluating effective tax planning in a profit shifting context (e.g. Rego, ; US Government Accountability Office, ; Markle and Shackelford, ; Sullivan, ; Herbert and Overesch, ). On the other hand, the empirical literature often refers to R&D activity as a proxy for IP‐based profit shifting (e.g.…”

Section: Effect Of Randd Intensity On Etrmentioning

confidence: 99%

“…Mills et al ., ; Phillips, ) and to detect profit shifting behaviour in particular (e.g. Markle and Shackelford, ; Rego, ).…”

Section: Introductionmentioning

confidence: 99%

R&D INTENSITY AND THE EFFECTIVE TAX RATE: A META‐REGRESSION ANALYSIS

Belz

Hagen

Steffens

2016

Journal of Economic Surveys

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We apply meta-regression techniques to provide a quantitative review of the empirical literature on how research and development (R&D) expenses affect the effective tax rate (ETR). R&D expenses relate to a well-accepted profit shifting channel, strategic placement of intellectual property within a multinational entity. Using a unique hand-collected data set, we add a new perspective to the current base erosion and profit shifting (BEPS) state of research and debate, in three ways: First, observing that primary studies report mixed evidence on how R&D expenses affect ETR, we provide a consensus estimate for this effect. Second, we consider this effect in more detail by separating a tax accounting effect and a profit shifting effect, which to our knowledge has not yet been investigated. We detect that one-third of the R&D effect on the ETR is due to the tax accounting effect and could be mitigated via book-tax conformity. We further find that 10% of the profit shifting effect can be traced back to R&D tax credits. Third, our meta-regression reveals factors that are possible sources of variation and bias in previous empirical studies.

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Cross-Country Comparisons of Corporate Income Taxes

Cited by 114 publications

References 28 publications

The Rise in Corporate Saving and Cash Holding in Advanced Economies:

The Rise in Corporate Saving and Cash Holding in Advanced Economies:

The Complementarity between Tax Avoidance and Manager Diversion: Evidence from Tax Haven Firms

R&D INTENSITY AND THE EFFECTIVE TAX RATE: A META‐REGRESSION ANALYSIS

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