Home > Publications . Search All . Browse All . Country . Browse PSC Pubs . PSC Report Series

PSC In The News

RSS Feed icon

Yang comments on importance of migrant remittances to future of recipient families

Frey says America's black population is changing with recent immigration

Bailey and Danziger's War on Poverty book reviewed in NY Review of Books

Highlights

Hicken wins 2015 UROP Outstanding Research Mentor Award

U-M ranked #1 in Sociology of Population by USN&WR's "Best Graduate Schools"

PAA 2015 Annual Meeting: Preliminary program and list of UM participants

ISR addition wins LEED Gold Certification

Next Brown Bag

Mon, May 18
Lois Verbrugge, Disability Experience & Measurement

The demand for tax haven operations

Archived Abstract of Former PSC Researcher

Desai, Mihir A., C. Fritz Foley, and James Hines, Jr. 2006. "The demand for tax haven operations." Journal of Public Economics, 90(3): 513-531.

What types of firms establish tax haven operations, and what purposes do these operations serve? Analysis of affiliate-level data for American firms indicates that larger, more international firms, and those with extensive intrafirm trade and high R and D intensities, are the most likely to use tax havens. Tax haven operations facilitate tax avoidance both by permitting firms to allocate taxable income away from high-tax jurisdictions and by reducing the burden of home country taxation of foreign income. The evidence suggests that the primary use of affiliates in larger tax haven countries is to reallocate taxable income, whereas the primary use of affiliates in smaller tax haven countries is to facilitate deferral of U.S. taxation of foreign income. Firms with sizeable foreign operations benefit the most from using tax havens, an effect that can be evaluated by using foreign economic growth rates as instruments for firm-level growth of foreign investment outside of tax havens. One percent greater sales and investment growth in nearby non-haven countries is associated with a 1.5 to 2% greater likelihood of establishing a tax haven operation.

DOI:10.1016/j.jpubeco.2005.04.004 (Full Text)

Browse | Search : All Pubs | Next