This paper analyzes the impact of countries' tax attractiveness on the allocation of risk within multinational groups. Our dataset contains subsidiaries located in 32 European countries and owned by parents from 90 different countries globally. We show that tax symmetry positively influences the...

This article provides an understanding of tax risk and its fundamental drivers, identifies potential gaps between tax departments and other stakeholders that may accentuate such risks, and offers suggestions on methods for quantifying and managing tax risk

This paper examines how nominal uncertainty affects the choice firms face to serve a foreign market through exports or to produce abroad as a multinational. I develop a two-country, stochastic general equilibrium model in which firms make production and pricing decisions in advance, and I...

Measuring the impact of political risk on investment projects is one of the most vexing issues in international business. One popular approach is to assume that the sovereign yield spread captures political risk and to augment the project discount rate by this spread. We show that this approach...

Given the current Portuguese economic and financial situation, it becomes increasingly necessary to safeguard the credits of the State. Thus, this study aims to analyze the risk of tax non-compliance, specifically in companies in the sector of real estate agencies. To achieve this goal, we use...

Corporate tax behavior has recently received considerable public interest, and anecdotal evidence suggests that firms are increasingly concerned about the reputational risk of tax planning. Using RepRisk data to capture firms’ reputational risk due to public scrutiny, this study examines the...

Using firm-level data for 1,084 parent firms in 24 countries and for 9,497 subsidiaries in 54 countries, we show that tax-motivated profit shifting is larger among subsidiaries in countries that have stable corporate tax rates over time. Our findings further suggest that firms move away from...

Taxpayers should expect capital gains rates to fluctuate in light of frequent historical changes and the current divergence of rates preferred by Democrats and Republicans. This paper is the first to model the effect of such rate uncertainty on the realization incentives of asset holders and...

I examine whether and to what extent tax uncertainty affects a firm's dividend payouts. Based on the argument that tax uncertainty impairs the persistence and predictability of after-tax cash flows, I hypothesize and find that firms with greater tax uncertainty exhibit a lower probability of...