Anti-tax-avoidance provisions and the size of foreign direct investment

1996 ◽  
Vol 3 (1) ◽  
pp. 67-81 ◽  
Author(s):  
Alfons J. Weichenrieder
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Tax Avoidance

scholarly journals Permanent establishment as a foreign direct investment in Poland: identification of tax barriers in the context of new tax development

2021 ◽  
Vol 57 (2) ◽  
pp. 177-193
Author(s):  
Marcin Jamroży ◽  
Magdalena Janiszewska
Keyword(s):  
Foreign Direct Investment ◽  
Economic Activity ◽  
Direct Investment ◽  
Business Models ◽  
Tax Avoidance ◽  
Tax Law ◽  
Profit Shifting ◽  
New Developments ◽  
Permanent Establishment ◽  
International Tax

Abstract The paper aims to identify the significant tax barriers to foreign direct investment (FDI) in Poland, in particular in the form of a permanent establishment (PE), in the context of new developments in international tax law. Due to the recommendations of the Base Erosion and Profit Shifting (BEPS) project, launched by Organisation for Economic Co-operation and Development (OECD) to prevent international tax avoidance, the understanding of PE has changed, which could lead to changes in business models. The purpose of the research is also to identify the significant tax barriers to economic activity in Poland, in particular in the form of PE, against the international tax law context. The study conducted by the authors relies on the most current tax rulings and judgments of administrative courts issued between 2017 and 2020. It is concluded that not so much the effective tax burdens but the regulatory ambiguity surrounding the tax obligations may contribute to the reduction of Poland's attractiveness as a location for FDI.

scholarly journals The Permanent Establishment Concept In Double Tax Agreements Between Developed And Developing Countries: Canada/South Africa As A Case In Point

2014 ◽  
Vol 13 (3) ◽  
pp. 539
Author(s):  
Lee-Ann Steenkamp
Keyword(s):  
South Africa ◽  
Developing Countries ◽  
Foreign Direct Investment ◽  
Developing Country ◽  
Direct Investment ◽  
Tax Avoidance ◽  
Tax Treaties ◽  
Permanent Establishment ◽  
Business Income

In this era of globalisation, developing countries have resorted to double tax agreements in order to attract foreign direct investment. The extent to which a countrys tax treaty policy favours developing countries or not depends upon the extent to which the country is prepared to adopt provisions from the UN model tax convention as opposed to the OECD model. Developing countries in particular should carefully consider the design of their tax treaties so as to effectively combat tax avoidance, without sacrificing foreign direct investment. To this end, the Canada/South Africa tax treaty is compared and contrasted with these two models. The concept of permanent establishment is reviewed in this context. It was found that the Canada/South Africa tax treaty is overwhelmingly based on the OECD model. This could indicate that South Africa has a deliberate tax treaty policy of ceding taxing rights to other countries. Thus, developing countries are seemingly unable or unwilling to make use of the UN model so as to retain greater source taxation. A number of recommendations are made to broaden the scope for the source taxation of business income in the developing country.

Impact of Tax Factors on Chinese FDIs

2019 ◽  
pp. 56-66
Author(s):  
Na Li
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Tax Avoidance ◽  
Tax Incentives ◽  
Chinese Government ◽  
Foreign Direct Investments ◽  
Business Decisions ◽  
Chinese Investment ◽  
Avoidance Measures ◽  
The Impact

The chapter explains that investment treaties are not the only drivers of Chinese foreign direct investments (FDIs). Tax factors also play an important role in impacting foreign direct investment into China (FDIs into China) and Chinese investment to other countries (Chinese outbound investment). This chapter examines the following questions: what are the impacts of tax factors on FDIs? Is the Chinese experience on using tax instruments consistent with these empirical findings? Whether China’s implementation of anti-tax avoidance measures might drive FDIs away from China? What are the tax competition concerns for China? The last section contains a conclusion. This chapter demonstrates that, despite the fact that debates are still ongoing about the impact of tax factors on FDI, Chinese experience shows that tax factors are used extensively by the Chinese government in both attracting FDIs into China as well as relieving tax disadvantages of Chinese outbound investment. Although China’s experience still cannot solve the mystery of whether tax incentives are effective on impacting FDIs, its implementing anti-tax avoidance measures in recent years have disclosed that tax transparency and certainty are important tax factors impacting business decisions. Therefore, China should take further into account the impact of tax factors on business before FDIs are scared away when implementing aggressive anti-tax avoidance measures.

scholarly journals Is Foreign Direct Investment Effective From The Perspective Of Tax Avoidance? An Analysis Of Tax Avoidance Through The International Transfer Pricing Behaviors Of Korean Corporations

2016 ◽  
Vol 32 (3) ◽  
pp. 917-934
Author(s):  
Sung Jin Park ◽  
Woo Jin Park ◽  
Eun Jung Sun ◽  
Sohee Woo
Keyword(s):  
Foreign Direct Investment ◽  
Empirical Analysis ◽  
Direct Investment ◽  
Transfer Pricing ◽  
Tax Avoidance ◽  
Multinational Companies ◽  
Parent Company ◽  
Tax Credits ◽  
Corporate Tax ◽  
Overseas Subsidiaries

This study examines whether multinational companies carry out tax avoidance through subsidiaries. An empirical analysis was conducted of 4,585 Korean firms from 2001 to 2010 by company and year. The results are as follows. First, MNCs that have become more internationally diversified through the establishment of overseas subsidiaries generally show a higher tendency to avoid tax. Thus, the analysis results show a positive correlation between globally diversified MNCs and corporate tax avoidance. This correlation is established due to the firms' active use of tax strategies (investment tax credits, tax cuts) applicable to the various countries in which they have expanded their businesses. Second, the analysis results showed that these firms actively avoided tax with overseas transfer pricing behaviors when compared to companies without overseas subsidiaries. Thus, the adjustment of sales prices and purchase value through actual transactions increased the propensity of the parent company to avoid tax. 

scholarly journals THE INFLUENCE OF TAX AVOIDANCE, FOREIGN DIRECT INVESTMENT AND CAPITAL INTENSITY TOWARDS EARNING RESPONSE COEFFICIENT

2020 ◽  
Author(s):  
Olivia Christine Chandra ◽  
Mukhlasin Mukhlasin
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Stock Exchange ◽  
Linear Regression Analysis ◽  
Tax Avoidance ◽  
Capital Intensity ◽  
Observation Data ◽  
Earnings Response Coefficient ◽  
Response Coefficient ◽  
Earnings Response

Earnings quality can be determined from the market or investor reaction to information in the published financial statements. But there are some factor, which can be considered to be biased for investors in determining their investment in a company. Market reaction can be proxy by earning response coefficient. This study aims to examine the effect of tax avoidance, foreign direct investment and capital intensity on earnings response coefficient. The population in this study is companies from manufacturing sector listed on the Indonesia Stock Exchange (IDX) for the period 2017-2019. Data obtained from the IDX website, Yahoo Finance and website of certain companies. The population of this study are 135 observation data. The hypothesis in this study were tested by multiple linear regression analysis. The result of this research are: 1) foreign direct investment and capital intensity have a positive effect on earnings response coefficient. 2) tax avoidance has no influence on earnings response coefficient.

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