Offshore finance and corporate tax avoidance
Location of profits
Location of employees
the Netherlands, Switzerland, Luxembourg, Ireland and Singapore
1. Which jurisdictions are OFCs?
3. to which extent do OFCs affect corporate tax rates?
2. how are OFCs used by MNCs?
Firms shift ~$800 billion to OFCs
- Corporate ownership networks
- Fragmentation of the firm
- Location of tax professionals
- Location of profits
Mainly UK colonies
Low tax on financial profits
Conduit to profit centers
High-value adding operations
Increased profit shifting: <30%
Decrease in tax rates: >70%
3. to which extent to OFCs affect tax rates?
Corporate tax rates are decreasing
Why is this importanT?
Economic efficiency AND EQUITY
By Javier GB