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http://hdl.handle.net/10125/64893
The general anti-avoidance rule
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HARC 2020 paper 205.pdf | 373.55 kB | Adobe PDF | View/Open |
Item Summary
Title: | The general anti-avoidance rule |
Authors: | Jon Kerr Mary Cowx |
Keywords: | Tax Planning Tax Avoidance International General Anti-Avoidance Rule Tax Risk |
Date Issued: | 30 Aug 2019 |
Abstract: | Although a general anti-avoidance rule (GAAR) being enacted within a country is becoming increasingly more common, the presence of a GAAR is generally overlooked and thus its effect left unstudied. In this paper we provide an initial investigation by studying the effect that the presence of a GAAR within a country has on corporate tax avoidance behaviors. Using an indicator for the enactment of a GAAR within a specific country, we find a statistically and economically significant increase in aggregate tax collections and a statistically and economically significant decrease in firm-level tax avoidance. Additional analyses show that the firm-level results are strongest for firms with higher levels of tax avoidance, for countries with lower levels of tax enforcement prior to the implementation of a GAAR, and for countries where the burden of proof lies, at least partially, with the taxpayer. In final analyses, we find that the GAAR is associated with a decrease in the volatility of reported ETRs. |
URI: | http://hdl.handle.net/10125/64893 |
Appears in Collections: |
19 Taxation |
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