Comparing UK Tax Returns of Foreign Multinationals to Matched Domestic Firms

• 成果类型: Article
• 署名作者: Bilicka, Katarzyna Anna
• 署名单位: Utah System of Higher Education; Utah State University
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/aer.20180496
• 发表日期: 2019
• 页码: 2921-2953
• 关键词: direct-investment; income; PRODUCTIVITY; incentives; havens; base

摘要

In this paper, I use confidential UK corporate tax returns data to explore whether there are systematic differences in the amount of taxable profits that multinational and domestic companies report. I find that the ratio of taxable profits to total assets reported by foreign multinational subsidiaries is one-half that of comparable domestic standalones. The majority of the difference is attributable to the fact that a higher proportion of foreign multinational subsidiaries report zero taxable profits. I document how the estimated difference is related to profit shifting and show that using accounting data leads to much smaller estimates of the difference.