The aim of this research project is to analyze the impacts of company taxation regarding cross-border business activities of multinational enterprises. Especially in Europe international business activities are of particular importance concerning the taxation since enterprises are comparatively free to operate their businesses from different countries within the Single European Market, but the effective tax burdens on companies differ significantly among these different locations. Thus, countries compete with each other for the establishment of subsidiaries as investment locations. Otherwise, this fact gives rise to tax planning by the parent company due to transfer pricing and group financing decisions. There is not much empirical evidence regarding the impacts and the application of tax planning except for some well-known cases-studies, although tax planning makes the complete taxation of the entire business profits very difficult. This absence of empirical research complicates the evaluation of reform proposals concerning company taxation. Against this background, the research project aims to analyse the tax planning activities of multinational German companies using the information about investment behaviour in the existing data base of the Deutsche Bundesbank and applying adequate econometric methods. Albeit the particular importance of this subjects in the fields of Business Administration and Public Finance such an empirical analysis regarding German enterprises is not existent at the moment.
Discussion and Working Papers
Buettner, Thiess, Michael Overesch, Ulrich Schreiber and Georg Wamser (2006), The Impact of Thin-Capitalization Rules on Multinationals' Financing and Investment Decisions, ZEW Discussion Paper No. 06-068, Mannheim. Download
Buettner, Thiess, Michael Overesch, Ulrich Schreiber and Georg Wamser (2006), Taxation and Capital Structure Choice - Evidence from a Panel of German Multinationals, ZEW Discussion Paper No. 06-067, Mannheim. Download
Deutsche Forschungsgemeinschaft, Bonn, DE
01.06.2005 - 31.05.2007