Profit Shifting and Tax Base Erosion: Case Studies of Post-Communist Countries (Contributions to Finance and Accounting)

This book provides a comprehensive analysis of current techniques for profit shifting and tax base erosion in the area of corporate taxation and measurement. Firstly, it explains the relevance of the issue at hand – profit shifting and base erosion in the context of the 21 st century. In turn, the book provides a comprehensive analysis of available techniques for the identification and measurement of profit shifting and base erosion, which adopt both the macro and micro perspective. It also provides examples from selected post-communist countries now in the EU, including the Czech Republic, Poland and Hungary. Concrete recommendations for economic policy round out the coverage. Contents List of Contributors List of Abbreviations List of Figures List of Tables Introduction References Profit Shifting and Tax Base Erosion in the Twenty-First Century 1 The Concept of Profit Shifting 2 The Role of Tax Havens in Profit Shifting 3 The Development of Corporate Taxation During the Century 4 The Fight Against Tax Base Erosion and Tax Fraud 5 Post-communist Countries with Respect to Aggressive Tax Planning Opportunities and Tax Base Erosion 6 Conclusion References Methodological Approaches to the Measurement of Profit Shifting and Tax Base Erosion 1 Categories of Profit Shifting Techniques and their General Channels 2 Methodological Approaches and Empirical Research on Profit Shifting and Tax Base Erosion 3 Estimation of the Corporate Tax Revenue Losses 4 Current Techniques of Profit Shifting and Tax Base Erosion: Macro Perspective 5 Current Techniques of Profit Shifting and Tax Base Erosion: Micro Perspective 6 Methodology Used in the Macrodata-Based Analysis for the Purpose of Post-Communist Countries 7 Methodology Used in the Microdata-Based Analysis for the Purpose of Post-Communist Countries 7.1 First Methodological Approach: Tax Differentials 7.2 Second Methodological Approach: Comparison of Financial Indicators 8 Summary References Economic Analysis from the Macro Perspective 1 Introduction 1.1 Profit Shifting and Tax Base Erosion from the Macro Perspective 2 Methodology and Data Description 3 Determination of Profit Shifting and Tax Base Erosion: Post-Communist Countries 3.1 Corporate Tax in Post-Communist Countries and Factors Influencing Its Rate 3.2 Which EU Countries Are Used for Aggressive Tax Planning Purposes? 3.3 Comparison of the Rate of Return 3.4 Excessiveness of Selected Cross-border Payments 3.5 Estimation of the Extent of Profit Shifting 4 Conclusions Annexure References Economic Analysis from the Micro-Perspective 1 Introduction 1.1 Methodology and Data Description 1.2 Determination of Profit Shifting and Tax Base Erosion: Post-Communist Countries: First Methodological Approach via Tax Dif... OLS Panel Data Regression Model Mixed Effects Model Estimation Estimation of the Extent of Profit Shifting 1.3 Determination of Profit Shifting and Tax Base Erosion: Post-Communist Countries: Second Methodological Approach via Discre... CFC Rules Effective Estimation of the Extent of Profit Shifting and Tax Base Erosion 1.4 Conclusions References Tax Policy in Relation to Fair Corporate Taxation 1 Tax Systems and Their Development 2 Concepts of Fair Taxation and Their Implications 3 Taxation and the Digital Society 3.1 Digitisation and Fair Income Taxation: National Tax Policies and International Coordination 3.2 Other Areas of Tax Policy and Digital Activities (Value-Added Taxes, Virtual Currencies and Digital Platforms) 4 International Exchange of Information and the Fairness of Taxation 4.1 Exchange of Information on Request (EOIR) 4.2 Automatic Exchange of Information 5 The CEE-EU Countries and Fair Taxation 5.1 Current Situation and Future Development 6 Policy Recommendations 7 Conclusion References Conclusion References