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  • 标题:Debt and tax planning by multinationals
  • 本地全文:下载
  • 作者:Stéphane Sorbe ; Åsa Johansson ; Øystein Bieltvedt Skeie
  • 期刊名称:Economics Department Working Papers / OECD
  • 印刷版ISSN:0259-4633
  • 出版年度:2017
  • 卷号:2017
  • 出版社:Organisation for Economic Co-operation and Development (OECD)
  • 摘要:

    Multinational enterprises (MNEs) manipulate the location of their debts to reduce their corporate tax burden. Indeed, by locating debts in higher-tax rate countries, MNEs can deduct interest payments against a higher tax rate. This paper provides evidence of such manipulation of debt location. The analysis is based on a large sample of firm-level data from the ORBIS database. By comparing the indebtedness of MNE entities with similar characteristics but different debt shifting opportunities, the analysis suggests that a 1 percentage point higher tax rate is associated with 1.3% higher third-party debt. This is a lower bound estimate of debt manipulation, since it excludes the manipulation of internal debt. The analysis also shows that strict rules limiting interest deductibility (e.g. thin capitalisation or interest-to-earnings rules) can reduce debt manipulation. The possibility to locate debts in higher-tax rate countries reduces the effective cost of debt for MNE groups. The empirical analysis suggests that this can lead MNE groups to increase their overall external indebtedness, compounding the “debt bias” existing in most tax systems.

  • 关键词:interest-to-earnings; thin capitalisation rules; debt bias; multinational tax planning; capital structure
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