Multinationals' sales and profit shifting in tax havens Sébastien Laffitte, Farid Toubal
By: Laffitte, Sébastien
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Contributor(s): Toubal, Farid.
Material type: 
ArticleSubject(s): EMPRESAS MULTINACIONALES | ESTADOS UNIDOS | VENTAS | BENEFICIOS | IMPUESTOS | EROSIÓN DE LA BASE IMPONIBLE Y TRASLADO DE BENEFICIOS | ELUSION FISCAL | EVASION FISCAL | PARAISOS FISCALES
In:
American Economic Journal : Economic Policy v. 14, n. 4, November 2022, p. 371-396Summary: We show that US multinationals record sales and the profits from these sales in tax havens while their goods and services are physically sold in other countries. We propose a framework illustrating the strategy of sales shifting. Our results reveal the importance of tax havens, which attract a disproportionate fraction of worldwide sales. Our quantification shows a large contribution of sales shifting to multinationals' profit shifting, which amounted to $80 billion in 2013. Our findings suggest that international corporate tax rules based on sales may not address profit shifting efficiently if the policy designs are unable to identify sales by destination.
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| OP 2135/2022/4 American Economic Journal : Economic Policy | OP 2135/2022/4-1 Behavioral responses to wealth taxes | OP 2135/2022/4-2 Your place in the world | OP 2135/2022/4-3 Multinationals' sales and profit shifting in tax havens | OP 2135/2022/4-4 Health care rationing in public insurance programs | OP 2135/2023/1 American Economic Journal : Economic Policy | OP 2135/2023/1-1 Tax audits as scarecrows |
Resumen.
Bibliografía.
We show that US multinationals record sales and the profits from these sales in tax havens while their goods and services are physically sold in other countries. We propose a framework illustrating the strategy of sales shifting. Our results reveal the importance of tax havens, which attract a disproportionate fraction of worldwide sales. Our quantification shows a large contribution of sales shifting to multinationals' profit shifting, which amounted to $80 billion in 2013. Our findings suggest that international corporate tax rules based on sales may not address profit shifting efficiently if the policy designs are unable to identify sales by destination.
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