Exploring the role Delaware plays as a domestic tax haven

Cross-Border Reverse Mergers: Causes and Consequences

“…According to the New York Times, a senior official of the Cayman Islands Financial Service Association asserted that, "Delaware, along with Nevada and Wyoming, promoted tax evasion and money laundering, thus qualifying the United States as a tax haven" (Browning 2009). We will examine whether these tax avoidance opportunities drown out the possibility of positive governance bonding in any state (no matter how good the corporate governance is in Delaware or in Nevada), as argued by Dyreng, Lindsey and Thornock (2011) in their study of subsidiary location choice among U.S. domestic firms.…”

Does Social Capital Matter in Corporate Decisions? Evidence from Corporate Tax Avoidance

“…We also examine the associations between social capital and tax avoidance measures based on decomposed federal, foreign, and state effective tax rates of corporations (Gupta and Mills [], Dyreng, Lindsey, and Thornock []). If social environments in local areas are more likely to affect corporate behaviors with greater local ramifications, one would expect a significant relation with respect to state taxes and perhaps a less significant, or even insignificant, relation with respect to foreign taxes.…”

Tax Rate Biases in Tax Planning Decisions: Experimental Evidence

“…Widely adopted tax-planning strategies exploit discretion in setting intra-group transfer prices -5 -for intermediate inputs (Beer andLoeprick 2015, Klassen andLaPlante 2012), special-tax regimes Thornock 2013, Dyreng andLindsey 2009), and financial instruments such as hybrids (Johannesen 2014), derivatives (Donohoe 2015), and insurance contracts (Brown 2011). In addition, income shifting through intra-group debt financing is widespread as internal capital markets enable firms to exploit tax-rate differentials (Desai, Foley, and Hines 2004) and to shift income via interest payments to low-tax jurisdictions (Buettner and Wamser 2013).…”