Disentangling business- and tax-motivated bilateral royalty flows

Arjan Lejour and Maarten van 't Riet ()
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Maarten van 't Riet: CPB Netherlands Bureau for Economic Policy Analysis

No 450, CPB Discussion Paper from CPB Netherlands Bureau for Economic Policy Analysis

Abstract: Multinational firms pay for the use of intellectual property (IP). The IP-rights may be located in another country where the royalty income is taxable. This taxation may differ between countries which offers opportunities for tax avoidance. This implies that bilateral royalty payments may not only be business motivated but may also be tax driven. We determine the shares of tax and business motivated flows. We estimate that at least 18% of the size of the flows is tax driven. The associated worldwide loss of tax revenue is between 6.5 and 16 billion US dollar.

JEL-codes: H25 H26 H32 (search for similar items in EconPapers)
Date: 2023-10
New Economics Papers: this item is included in nep-ipr, nep-pbe and nep-pub
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Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Disentangling Business- and Tax-Motivated Bilateral Royalty Flows (2023)
Working Paper: Disentangling Business- and Tax-Motivated Bilateral Royalty Flows (2023)
Working Paper: Disentangling Business- and Tax-Motivated Bilateral Royalty Flows (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:cpb:discus:450

DOI: 10.34932/0edy-v759

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