We look at the tax burden on direct investment from three perspectives. The first section illustrates how the recognition of company tax planning and of the importance of intellectual property affects measures of effective tax rates. It also discusses the methodological issues that arise, such...

International transfer pricing controversies and subsequent litigations with taxation authorities have become the major issues in foreign investments and international technology transfers. Disputes between the taxation authorities and MNCs are mounting up as most of the MNCs are now contesting...

Do low corporate taxes always favor multinational production in the course of economic integration? We build a two-country spatial model with different corporate tax rates in which multinational enterprises (MNEs) can manipulate transfer prices in intra-firm trade. Using transfer pricing, MNEs...

Enterprises seek profit maximization that comprises tax optimization which, within multinationals, includes the shifting of profits from the less to the most favorable countries using transfer pricing of intra-group transactions and tax havens as the “middle man”. Because FDI is an important...

For mitigating the problems of transfer pricing formula apportionment (FA) is discussed intensively. However, FA could even be more harmful than transfer pricing because income shifting would require changing economic decisions instead of just taking advantage of accounting options. We analyze...

Unilateral adoption of transfer pricing regulations may have a negative impact on real investment by multinational corporations (MNCs). This paper uses a quasi-experimental research design, exploiting unique panel data on domestic and multinational companies in 27 countries during 2006-2014, to...