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Tax Havens and Effective Tax Rates: An Analysis of Private versus Public European Firms

Jaafar, A. and Thornton, J. (2015) Tax Havens and Effective Tax Rates: An Analysis of Private versus Public European Firms. The International Journal of Accounting. (In Press)

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Abstract

We examine the impact of tax-haven operations on the effective corporate tax burdens of publicly listed and privately held firms domiciled in Europe. In particular, we consider how European firms� tax haven operations interacts with factors such listing status and home-country tax reporting systems to determine the relative tax burdens of publicly listed and private firms. Our main empirical results show that tax haven operations is associated with lower effective tax rates for both private and public firms, and that the impact of tax havens in lowering effective tax rates is more pronounced for private firms than for public firms.Home country characteristics are also important determinants of effective tax rates for both private and public firms with tax havens. Given that firms, regardless of their listing status, use tax havens as tax avoidance mechanism in lowering tax burdens, regulatory and tax enforcement bodies should focus not only on public firms but also on private firms.

Item Type: Article
Subjects: Research Publications
Departments: College of Business, Law, Education and Social Sciences > Bangor Business School
Date Deposited: 19 Sep 2015 02:50
Last Modified: 02 Nov 2017 03:15
ISSN: 0020-7063
URI: http://e.bangor.ac.uk/id/eprint/5369
Publisher: Elsevier
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