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Article
Tax Havens and Effective Tax Rates: An Analysis of Private versus Public European Firms
The International Journal of Accounting (2015)
  • John Thornton
  • Aziz Jaafar
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 interact with factors such as 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 are 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 use tax havens as a tax avoidance mechanism in lowering tax burdens regardless of their listing status, regulatory and tax enforcement bodies should focus on private as well as public firms.
Keywords
  • Effective tax rates,
  • Publicly listed firms,
  • Private firms,
  • Tax havens
Publication Date
2015
Citation Information
John Thornton and Aziz Jaafar. "Tax Havens and Effective Tax Rates: An Analysis of Private versus Public European Firms" The International Journal of Accounting (2015)
Available at: http://works.bepress.com/john_thornton/35/