The case of taxing multinational corporations in Uganda: Do multinational corporations face lower effective tax rates and is there evidence for profit shifting?

Aliisa Koivisto, Nicholas Musoke, Dorothy Nakyambadde and Caroline Schimanski

No wp-2021-51, WIDER Working Paper Series from World Institute for Development Economic Research (UNU-WIDER)

Abstract: We study how large domestic firms and multinational corporations compare in their effective tax rates and whether there is evidence of profit shifting out of Uganda. Using administrative data from the Uganda Revenue Authority and regression analysis, we find that multinational corporations lower their corporate tax burden through two channels: lower effective tax rates and profit shifting. Multinational corporations pay lower effective tax rates, by approximately 20 percentage points, on their reported profits than large domestic corporations because of tax treaties and other benefits.

Keywords: Multinational firms; Profit shifting; Effective tax rate (search for similar items in EconPapers)
Date: 2021
New Economics Papers: this item is included in nep-isf and nep-pbe
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Citations: View citations in EconPapers (3)

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