Information sharing and tax competition among governments

Bacchetta, Philippe; Espinosa, Marı́a Paz

doi:10.1016/0022-1996(94)01356-w

Cited by 81 publications

(42 citation statements)

References 22 publications

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“…The analytical literature on the international exchange of tax information remains relatively small, with contributions including Bacchetta andEspinosa (1995, 2000), Keen (2001), Eggert andKolmar (2001, 2002) and Huizinga and Nielsen (2003). These papers, especially the first, have identified one possible source of mutual benefit from information exchange: by diminishing the attractions of trying to escape domestic tax by saving abroad and concealing the proceeds, information exchange may have the effect of weakening the tendency of each country to set a low tax rate in order to protect its own tax base.…”

Section: Introductionmentioning

confidence: 99%

Incentives and Information Exchange in International Taxation

Keen

Ligthart

2004

SSRN Journal

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The exchange of taxpayer-specific information between national tax authorities has recently emerged as a key and controversial topic in international tax policy discussions, most notably with the OECD's harmful tax practices project and the EU's savings tax initiative. This paper analyses the effects of information exchange and withholding taxes, recognizing that countries which agree to exchange information do not forfeit the ability to levy withholding taxes, and also focusing in particular on the effects of innovative revenuesharing arrangements. Amongst the findings are that: (i) the transfer of withholding tax receipts to the residence country, as planned in the EU, has no effect on equilibrium tax rates, but acts purely as a lump sum transfer; (ii) in contrast, allocating some of the revenue from information exchange to the source country-counter to usual practice (though no less so than the EU agreement)-would have adverse strategic effects on total revenue; (iii) nevertheless, any withholding tax regime is Pareto dominated by information exchange combined with appropriate revenue sharing; and, in particular, (iv) sharing of the additional revenues raised from information provided, while efficiency-reducing, could be in the interests of large (high-tax) countries as a means of persuading small (low-tax) countries to provide that information voluntarily. JEL codes:H77; H87; F42

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Section: Introductionmentioning

confidence: 99%

Incentives and Information Exchange in International Taxation

Keen

Ligthart

2004

SSRN Journal

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“…Braun & Weichenrieder (2015) find that once tax havens signed a TIEA, they are less likely to attract foreign subsidiaries. Bacchetta & Espinosa (1995, 2000 theoretically analyze the incentives for exchanging tax-related information using a game-theory framework. Bacchetta & Espinosa (1995) find that "large countries have an incentive to transmit information through strategic motives"(p. 276).…”

Section: Literaturementioning

confidence: 99%

“…Bacchetta & Espinosa (1995, 2000 theoretically analyze the incentives for exchanging tax-related information using a game-theory framework. Bacchetta & Espinosa (1995) find that "large countries have an incentive to transmit information through strategic motives"(p. 276). Bacchetta & Espinosa (2000) show that repeated interactions among governments may provide incentives to supply information.…”

Section: Literaturementioning

confidence: 99%

Tax Information Exchange with Developing Countries and Tax Havens

Braun

Zagler

2015

SSRN Journal

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“…Central contributions are those of Bacchetta andEspinosa (1995, 2000), Eggert and Kolmar (2002a, 2002b, 2004, Huizinga and Nielsen (2003), and Keen and Ligthart (2005a): see Keen and Ligthart (2005b) for a survey. 4 A central feature of most of these analyses is the ability of each country to charge different capital income tax rates to residents and nonresidents.…”

Section: Introductionmentioning

confidence: 99%

Revenue Sharing and Information Exchange under Non-Discriminatory Taxation

Keen

Ligthart

2005

SSRN Journal

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The international exchange of tax information, and its merits compared to withholding taxes, is the central topic in current debates in international tax policy. The purpose of this paper is to characterize and compare the tax regimes that emerge with and without information exchange, under the assumption that countries are unable to differentiate between the taxes they apply to residents and non-residents. It focuses in particular on the role of asymmetries in country size (capturing a key feature of tax havens) and on the impact and potential desirability of schemes to share the revenue raised by withholding (as under the new EU savings tax arrangements) or (more innovatively) as a consequence of information exchange. It is shown that (irrespective of country size difference) Pareto efficiency requires that all revenue collected from nonresidents be transferred to the residence country-which would require taking the EU practice even further from the norm, but is currently the norm in relation to information exchange. A withholding scheme with revenue fully reallocated in this way Pareto dominates information sharing, whatever the allocation under the latter. Comparing schemes in which there is no revenue sharing, however, shows that information exchange Pareto dominates simple withholding.JEL codes: H77, H87, F42.

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Information sharing and tax competition among governments

Cited by 81 publications

References 22 publications

Incentives and Information Exchange in International Taxation

Incentives and Information Exchange in International Taxation

Tax Information Exchange with Developing Countries and Tax Havens

Revenue Sharing and Information Exchange under Non-Discriminatory Taxation

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