Why Pay More? Corporate Tax Avoidance Through Transfer Pricing in OECD Countries
Eric J. Bartelsman
Vrije Universiteit Amsterdam; Tinbergen Institute; Institute for the Study of Labor (IZA)
Roel M. W. J. Beetsma
University of Amsterdam - Research Institute in Economics & Econometrics (RESAM); Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute for Economic Research); Tinbergen Institute - Tinbergen Institute Amsterdam (TIA); Netspar
CESifo Working Paper Series No. 324
This paper presents evidence of profit shifting in response to differences in corporate tax rates for a large selection of OECD countries. In our estimates we control for the effects of tax rate changes on real activity. Our baseline estimates suggest that, on average, a unilateral increase in the corporate tax rate does not lead to an increase in corporate tax revenues owing to a more than offsetting decline in reported profits.
Number of Pages in PDF File: 22
Keywords: Profit shifting, transfer pricing, corporate tax rates, STAN database
JEL Classification: F2, H2working papers series
Date posted: February 7, 2001
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