Multinationality, Tax Havens, Intangible Assets, and Transfer Pricing Aggressiveness: An Empirical Analysis

2015 ◽  
Vol 14 (1) ◽  
pp. 25-57 ◽  
Author(s):  
Grantley Taylor ◽  
Grant Richardson ◽  
Roman Lanis
Keyword(s):  
Empirical Analysis ◽  
Multinational Firms ◽  
Intangible Assets ◽  
Transfer Pricing ◽  
Data Availability ◽  
Tax Havens ◽  
Joint Effects ◽  
Tax Haven ◽  
Tax Benefits ◽  
The Individual

ABSTRACT This study examines the individual and joint effects of multinationality, tax havens, and intangible assets on transfer pricing aggressiveness. Based on a hand-collected sample of 286 publicly listed U.S. multinational firms over the 2006–2012 period (2,002 firm-year observations), the regression results indicate that multinationality, tax haven utilization, and intangible assets are significantly positively associated with transfer pricing aggressiveness. The regression results also show that firms magnify their international transfer pricing aggressiveness through the joint effects of intangible assets, multinationality, and tax havens. Overall, the empirical findings demonstrate that the utilization of tax havens and the level of intangible assets are economically important factors that assist firms in obtaining tax benefits through transfer pricing aggressiveness. Data Availability: All data are available from public sources identified in the paper.

scholarly journals When Does Tax Avoidance Result in Tax Uncertainty?

2018 ◽  
Vol 94 (2) ◽  
pp. 179-203 ◽  
Author(s):  
Scott D. Dyreng ◽  
Michelle Hanlon ◽  
Edward L. Maydew
Keyword(s):  
Transfer Pricing ◽  
Tax Avoidance ◽  
Pricing Strategies ◽  
Tax Rates ◽  
Effective Tax Rates ◽  
Time Period ◽  
Tax Haven ◽  
Tax Benefits ◽  
Tax Uncertainty

ABSTRACT We investigate the relation between tax avoidance and tax uncertainty, where tax uncertainty is the amount of unrecognized tax benefits recorded over the same time period as the tax avoidance. On average, we find that tax avoiders, i.e., firms with relatively low cash effective tax rates, bear significantly greater tax uncertainty than firms that have higher cash effective tax rates. We find that the relation between tax avoidance and tax uncertainty is stronger for firms with frequent patent filings and tax haven subsidiaries, proxies for intangible-related transfer pricing strategies. The findings have implications for several puzzling results in the literature.

scholarly journals The Impact of Tax Preferences on the Investment Attractiveness of Bonds for Retail Investors: The Case of Russia

2020 ◽  
Vol 13 (4) ◽  
pp. 72
Author(s):  
Natalia B. Boldyreva ◽  
Liudmila G. Reshetnikova ◽  
Elena A. Tarkhanova ◽  
Zhanna V. Pisarenko ◽  
Svetlana A. Kalayda
Keyword(s):  
Empirical Analysis ◽  
Tax Incentives ◽  
Government Bonds ◽  
The Real ◽  
Bank Deposits ◽  
Retail Investors ◽  
Tax Benefits ◽  
The Individual ◽  
The Impact

The impact of tax incentives on the investment attractiveness of bonds for retail investors is assessed in the article. The paper presents a comparative empirical analysis of investment attractiveness of Russian bonds and bank deposits for domestic retail investors. We identify investment preferences of retail investors in Russia, analyze investment characteristics of deposits in Russian banks and a variety of bonds available for retail investors. Given the tax benefits of the recently introduced Individual Investment Account, we show that the real yield of investment in government bonds is over eight times higher than the yield of bank deposits. Despite higher risks of investing in bonds, we conclude that government bonds taking into account the tax benefits of the Individual Investment Account could be a realistic alternative to bank deposits for Russian retail investors.

scholarly journals The Influence of Income Shifting Incentives towards The Tax Haven Country Utilization: Case Study on the Companies listed in Indonesian Stock Exchange

2018 ◽  
Vol 20 (1) ◽  
pp. 27
Author(s):  
Nurhidayati Nurhidayati ◽  
Hendyga Fuadillah
Keyword(s):  
Intangible Assets ◽  
Stock Exchange ◽  
Transfer Pricing ◽  
Income Shifting ◽  
Intangible Asset ◽  
Profit Shifting ◽  
Industrial Sectors ◽  
Tax Haven ◽  
Directorate General ◽  
Thin Capitalization

This study aims to determine the association between a series of income shifting incentives, including multinationality, transfer pricing aggressiveness, thin capitalization, intangible assets, and tax haven country utilization. This study is based on a sample of 78 multinational companies listed on the Indonesia Stock Exchange over 2012–2016 period (390 firm-year). The results prove that, multinationality, thin capitalization, intangible asset are positively associated with tax haven utilization, while transfer pricing aggressiveness is not positively associated with tax haven utilization. Based on the additional analysis, basic and chemicals sectors have the highest association between a series of income shifting incentives and tax haven utilization among other industrial sectors and each industry sector has different ways of utilizing tax haven country. The findings of this study are expected to provide input to the Directorate General of Taxes the importance of reviewing debt to equity ratio rule which turned out to be one gap for the taxpayer and in making the proposed inspection plan and the potential thematic exploration related to profit shifting incentives more focused on basic industry and chemicals sector. The Directorate General of Taxes also needs to raise awareness of the taxpayers of agriculture, mining, basic and chemicals, and trade, service and investment, which has a growing number of subsidiaries in tax haven country. Increased supervision of intangible assets transfers in the agriculture and infra­structure, utilities & transportation sectors also needs to be done.

scholarly journals Tax incentives as an element of the state's economic policy

KANT ◽  
2020 ◽  
Vol 37 (4) ◽  
pp. 62-66
Author(s):  
Niiara Demiroglu
Keyword(s):  
Economic Policy ◽  
Tax Incentives ◽  
Tax Havens ◽  
Tax Haven ◽  
Accelerated Depreciation ◽  
Tax Benefits ◽  
Tax Holidays

The article considers the necessity and relevance of tax incentives, and its types: "tax holidays", "tax haven", "tax havens", "investment credit", "accelerated depreciation", "tax deferral". The goals of economic tax incentives are systematized. The classification of tax benefits is generalized. Conclusions are drawn about the need to assess the effectiveness of tax incentives.

Error Management in Audit Firms: Error Climate, Type, and Originator

2013 ◽  
Vol 89 (1) ◽  
pp. 303-330 ◽  
Author(s):  
Anna Gold ◽  
Ulfert Gronewold ◽  
Steven E. Salterio
Keyword(s):  
Impression Management ◽  
Data Availability ◽  
Error Management ◽  
Organizational Life ◽  
Climate Type ◽  
Error Type ◽  
Audit Firms ◽  
The Individual ◽  
Post Hoc ◽  
Willingness To Report

ABSTRACT This paper examines how the treatment of audit staff who discover errors in audit files by superiors affects their willingness to report these errors. The way staff are treated by superiors is labelled as the audit office error management climate. In a “blame-oriented” climate errors are not tolerated and those committing errors are punished. In contrast, an “open” climate characterizes error commitment as a normal, albeit unfortunate aspect of organizational life that offers opportunities for learning without sanctions on the originator. We examine error management climate in the context of audit-specific factors that might affect the decision to report errors: audit error type (conceptual or mechanical) and who committed the error (the individual who discovered it or a peer). An open climate results in an increase in the reporting of mechanical (but not conceptual) errors and all peer errors versus a blame climate. Post hoc findings suggest that one obstacle to reporting conceptual errors stems from an auditor's own impression management concerns. We discuss how auditing standards and regulatory inspections may impact audit firm error management climates. Data Availability: Experimental data are available from the second author subject to data confidentiality restrictions issued by the participating firms.

scholarly journals Substitution across profit shifting methods and the impact on thin capitalization rules

2021 ◽  
Author(s):  
Gideon Goerdt ◽  
Wolfgang Eggert
Keyword(s):  
Multinational Firms ◽  
Transfer Pricing ◽  
Multinational Firm ◽  
Profit Shifting ◽  
Goods And Services ◽  
Internal Goods ◽  
Transfer Prices ◽  
Debt Shifting ◽  
The Impact ◽  
Thin Capitalization

AbstractThin capitalization rules limit firms’ ability to deduct internal interest payments from taxable income, thereby restricting debt shifting activities of multinational firms. Since multinational firms can limit their tax liability in several ways, regulation of debt shifting may have an impact on other profit shifting methods. We therefore provide a model in which a multinational firm can shift profits out of a host country by issuing internal debt from an entity located in a tax haven and by manipulating transfer prices on internal goods and services. The focus of this paper is the analysis of regulatory incentives, $$(i)$$ ( i ) if a multinational firm treats debt shifting and transfer pricing as substitutes or $$(ii)$$ ( i i ) if the methods are not directly connected. The results provide a new aspect for why hybrid thin capitalization rules are used. Our discussion in this paper explains why hybrid rules can result in improvements in welfare if multinational firms treat methods of profit shifting as substitutes.

A Closer Look at the Individual and Joint Effects of Gender and Race on Juvenile Justice Decision Making

2009 ◽  
Vol 4 (4) ◽  
pp. 333-358 ◽  
Author(s):  
Michael J. Leiber ◽  
Sarah Jane Brubaker ◽  
Kristan C. Fox
Keyword(s):  
Decision Making ◽  
Juvenile Justice ◽  
Joint Effects ◽  
Gender And Race ◽  
The Individual

Family influence on career decisions: perceptions of Latin American CEOs

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Maria Rita Blanco ◽  
Mariela N. Golik
Keyword(s):  
Latin American ◽  
Multinational Firms ◽  
Extended Family ◽  
Career Decisions ◽  
Family Factors ◽  
Family Influence ◽  
Content Type ◽  
The Family ◽  
The Individual ◽  
Career Literature

PurposeThe career is a space where family and work lives amalgamate. The role of work for the individual, and the meaning of work within the culture, will determine the relevance of family. This study investigates CEOs' perception about conjugal family influence on career decisions, and it examines family factors.Design/methodology/approachThrough a qualitative study, 22 Latin American CEOs who work for multinational firms were interviewed in a semi-structured way.FindingsNot all career decisions were influenced by conjugal family. CEOs varied in the extent to which they considered their families when reflecting on their career decisions. Expatriation, joining or quitting an organization and change of area of work were found as those decisions perceived to be influenced by conjugal family. Family support, family structure and family demands and responsibilities were identified as the family factors involved. In spite of the role salience, family factors influenced some of CEOs' career decisions, in part, due to the cultural characteristics of the Latin American environment. The instrumental support of the extended family, as part of collectivist societies, was also evidenced.Practical implicationsA better understanding of the family influenced decisions and family factors involved may enhance individual career decision-making as well as organizational career management processes and public initiatives.Originality/valueThis study contributes to family and career literature, being the first one to explore the conjugal family influence upon CEOs' career decisions.

Sign in / Sign up

Export Citation Format

Share Document