Tax Base Erosion Symptoms? – Overview on Offshore Capital Outflow

Bálint Tamás Vargha

Public Finance Quarterly, 2017, vol. 62, issue 2, 188-211

Abstract: This article aims to give a broad overview on the knowledge available about the criteria of offshore jurisdictions, their historical development, the characteristics and degree of capital outflow, the involvement of Hungarian assets, its implications on sovereignty, the major features of national and EU legislation, and the potential directions of a supreme audit institution. It also endeavours to place the phenomenon of offshore economy in a global political economic context. This article relies largely on reviewing academic articles written in English that offer an international comparison. Giving an exhaustive definition of offshore jurisdiction and quantifying the capital affected is one of the major challenges of the topic. However, the calculations available are rather eloquent: semi-developed economies accumulating large foreign debts could have been subject to capital flight to offshore destinations in amounts exceeding their indebtedness. There are indications that offshore capital flight is merely a specific case of wealth leaving developing economies, notwithstanding that adverse effects emanate at economies of core countries, too. Hungary is subject to the negative impacts of the offshore phenomenon also on account of its relative position embedded in the world economy. Although regulation never managed to mitigate offshore, and only led to a restructuring among destination countries, auditing the efforts made by competent state authorities to explore taxable offshore assets is an option.

Keywords: offshore; taxation; political economy; capital flight; capital outflow (search for similar items in EconPapers)
JEL-codes: F21 F32 F39 F42 (search for similar items in EconPapers)
Date: 2017
References: Add references at CitEc
Citations:

Downloads: (external link)
https://unipub.lib.uni-corvinus.hu/8776/ (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pfq:journl:v:62:y:2017:i:2:p:188-211

Access Statistics for this article

More articles in Public Finance Quarterly from Corvinus University of Budapest Contact information at EDIRC.
Bibliographic data for series maintained by Adam Hoffmann ().