An FDI-driven approach to measuring the scale and economic impact of BEPS

Bolwijn, Richard and Casella, Bruno and Rigo, Davide (2018): An FDI-driven approach to measuring the scale and economic impact of BEPS. Published in: Transnational Corporations , Vol. 25, No. 2 (14 September 2018): pp. 107-143.

Abstract

This paper explores the link between foreign direct investment (FDI) and the BEPS (base erosion and profit shifting) practices of multinationals (MNEs). It puts the spotlight on the outsize role of offshore investment hubs as major players in global corporate investment, a role that is largely due to MNEs’ tax planning, although other factors contribute. The paper shows that tax avoidance practices enabled by FDI through offshore hubs are responsible for significant leakage of development financing resources. In policy terms, these findings call for enhanced cooperation and synergies between international tax and investment policymaking.

• Item Type: MPRA Paper
• Language: English
• Keywords: multinational enterprise, BEPS, revenue losses, developing countries, offshore investment
• Subjects: F - International Economics > F0 - General > F02 - International Economic Order and Integration; F - International Economics > F2 - International Factor Movements and International Business > F23 - Multinational Firms ; International Business; F - International Economics > F3 - International Finance > F36 - Financial Aspects of Economic Integration; F - International Economics > F3 - International Finance > F38 - International Financial Policy: Financial Transactions Tax; Capital Controls

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