Tariff-induced transfer pricing and the CCCTB

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Title: Tariff-induced transfer pricing and the CCCTB
Authors: Davies, Ronald B.
Permanent link: http://hdl.handle.net/10197/4799
Date: Sep-2013
Abstract: The common consolidated corporate tax base has been suggested as a way to curb tax avoidance by allocating profits across borders via a formula. This paper demonstrates that when transfer pricing occurs both for tariff and tax minimization, that moving from separate accounting to formula apportionment can actually increase transfer pricing. This, combined with arm's length pricing regulations, can result in lower revenues for high-tax countries and lower overall revenues. This casts additional doubt over whether such a move would have its intended, revenue-enhancing effects.
Funding Details: Not applicable
Type of material: Working Paper
Publisher: University College Dublin. School of Economics
Series/Report no.: UCD Centre for Economic Research Working Paper Series; WP13/14
Keywords: Common Consolidated Corporate Tax BaseVertical FDITransfer pricingFormula apportionment
Other versions: http://www.ucd.ie/t4cms/WP13_14.pdf
Language: en
Status of Item: Not peer reviewed
Appears in Collections:Economics Working Papers & Policy Papers

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