Estimating the magnitude of capital flight due to abnormal pricing in international trade: The Russia–USA case

Boyrie, Maria E. de; Pak, Simon J.; Zdanowicz, John S.

doi:10.1016/j.accfor.2005.03.004

Cited by 43 publications

(21 citation statements)

References 15 publications

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“…Much of the existing research exploring the impact of tax evasion and avoidance by MNCs on developing countries uses trade price data, including research conducted by De Boyrie et al. (), Tax Justice Network (), Hogg et al. (), and by Global Financial Integrity, such as Kar and Freitas ().…”

Section: How Tax Avoidance and Evasion Hinder Developmentmentioning

confidence: 99%

International Profit‐Shifting out of Developing Countries and the Role of Tax Havens

Jánský

Prats

2015

Development Policy Review

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This article contributes to the debate on how tax avoidance and evasion can hamper development efforts by investigating the link between profit‐shifting out of developing countries and tax havens. Analysis of more than 1500 multinational corporations (MNCs) operating in India shows that in 2010 those MNCs with links to tax havens reported lower profits and paid less in taxes per unit of asset than MNCs with no such links. This confirms the notion that when corporations have links to tax havens they enjoy higher incentives, because of the low tax rates, and opportunities to shift income because of the secrecy provisions tax havens offer.

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Section: How Tax Avoidance and Evasion Hinder Developmentmentioning

confidence: 99%

International Profit‐Shifting out of Developing Countries and the Role of Tax Havens

Jánský

Prats

2015

Development Policy Review

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“…On the other hand, it is very difficult to establish global price matrix and determine proper benchmark prices because of the large volume of world transactions, the heterogeneity of country and product, the cost differentiation between different countries, and so on. Even if benchmark prices are set from partial data on trade pricing, a significant proportion would likely escape detection['4' [15].…”

Section: Estimates Of Transfer Price-based Money Launderingmentioning

confidence: 99%

Transfer Price-based Money Laundering in International Trade

Gao

Li-fang

2006

2006 International Conference on Management Science and Engineering

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This paper defines money laundering in the context of international trade and builds analytic models to measure the contribution of transfer prices to international money laundering. Money laundry-related transfer pricing and transfer price-based money laundering are analyzed in detail. It argues that transfer price-based capital flight and tax evasion are variants of money laundering in nature to the extent that they all enable the apparently legal ownership of the property shifted illegally. Our main contribution lies in the identification of the artificial transfer pricing (ATP) paradigm and integrating capital flight and tax evasion into the models to estimate its contribution to global money laundering pool, helping anti-money laundering (AML) policy-makers better understand the nature of transfer pricing and its negative impact upon the economy. It concludes that effective audit and inspection systems should be established in order to better detect suspicious money laundering transactions and prevent money laundering crimes (MLCs).

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“…A common way of doing this even in the presence of capital controls is through under-and over-invoicing. De Boyrie et al (2005) estimate that over-and under-invoicing accounted for the movement of $1.01 to $4.85 billion per year between the Russia and the United States for the period 1995-1999. Tikhomirov (1997 estimated that mispricing of Russian trade in the years 1990-1995 resulted in capital flight that was six-fold the official Russian government estimates of $35-40 billion.…”

Section: Introductionmentioning

confidence: 98%

The costs of moving money across borders and the volume of capital flight: the case of Russia and other CIS countries

2011

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Estimating the magnitude of capital flight due to abnormal pricing in international trade: The Russia–USA case

Cited by 43 publications

References 15 publications

International Profit‐Shifting out of Developing Countries and the Role of Tax Havens

International Profit‐Shifting out of Developing Countries and the Role of Tax Havens

Transfer Price-based Money Laundering in International Trade

The costs of moving money across borders and the volume of capital flight: the case of Russia and other CIS countries

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