Using unique transaction-level microdata, this paper documents profit-shifting behavior by U.S. multinational firms via the strategic transfer pricing of intra-firm trade. A simple model reveals how differences in tax rates, both the corporate tax rates across countries and the dividend...

Corporate income tax law in OECD countries requires multinational enterprises (MNEs) to set their transfer prices according to the arm's length standard. In 1990, the US government introduced a transfer pricing penalty for cases where MNEs deviated substantially from this standard. Most OECD...

This chapter from a Practical Guide to Transfer Pricing (Lexis) compares the U.S. Section 482 transfer pricing regulations to the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations as revised in 2010. Section 482's purpose is to ensure that taxpayers subject...

The 2017 Tax Cut and Jobs Act reduced the US corporate tax rate and introduced provisions to curb profit shifting. We combine survey data, tax data, and firm financial statements to study the evolution of the geographical allocation of US firms' profits after the reform. The share of profits...

In 2015, the Irish government announced the closure of the Double Irish; one of the largest tax loopholes used by U.S. multinational companies, giving existing users until 2020 to comply. Using U.S. administrative corporate tax data, I provide novel estimates on profit shifted back to the United...

Successful IRS enforcement of corporate transfer pricing regulations is by all measures at an all-time low, and profit shifting from transfer pricing appears to be near an all-time high, costing the U.S. federal and state treasuries as much $140 billion dollars or more per annum in recent years,...

This study analyzes whether tax incentives play a role in the geographical allocation of U.S. trademark rights within large multinational enterprises. Considering the S&P 500 firms, we find a strong home country concentration of U.S. trademark ownership. Still, the probability to offshore legal...

Recent empirical evidence suggests that domestic firms avoid taxes at least to the same extent as multinational firms. We extend this finding by developing an approach to estimate the average statutory tax rate from publicly available data that implicitly weights all statutory tax rates a firm...

Using pairs of similar US and European firms listed on the S&P500 or StoxxEurope600, we examine effective tax differentials between US multinational corporations (MNCs) and their European peers. We show that statutory tax rates and profit shifting opportunities are important determinants of...