Big Data and Tax Haven Secrecy

57 Pages Posted: 1 Apr 2016  

Arthur J. Cockfield

Queen's University - Faculty of Law

Multiple version iconThere are 2 versions of this paper

Date Written: 2016

Abstract

While there is now significant literature in law, politics, economics, and other disciplines that examines tax havens, there is little information on what tax haven intermediaries — so-called offshore service providers — actually do to facilitate offshore evasion, international money laundering, and the financing of global terrorism. To provide insight into this secret world of tax havens, this Article relies on the Author’s study of big data derived from the financial data leak obtained by the International Consortium for Investigative Journalists (ICIJ). A hypothetical involving Breaking Bad’s Walter White is used to explain how offshore service providers facilitate global financial crimes. A transaction cost perspective assists in understanding the information and incentive problems revealed by the ICIJ data leak, including how tax haven secrecy enables elites in nondemocratic countries to transfer their monies for ultimate investment in stable democratic countries. The approach also emphasizes how, even in a world of perfect information, political incentives persist that thwart cooperative efforts to inhibit global financial crimes.

Keywords: Tax law, international tax law, offshore tax evasion, aggressive international tax avoidance, big data

JEL Classification: C80, D80, H25, H26, K34, K42, M40

Suggested Citation

Cockfield, Arthur J., Big Data and Tax Haven Secrecy (2016). Florida Tax Review, Vol. 18, pp. 483-539, 2016. Available at SSRN: https://ssrn.com/abstract=2757268

Arthur Cockfield (Contact Author)

Queen's University - Faculty of Law ( email )

Macdonald Hall
Kingston, Ontario K7L 3N6 K7L3N6
Canada

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