A1 - Manon Francois
A1 - Vincent Vicard
TI - Tax Avoidance and the Complexity of Multinational Enterprises
IS - 2023-04
T3 - Working Papers
KW - Complexity
KW - Firm organization
KW - Multinational enterprises
KW - Profit shifting
KW - Tax avoidance
N2 - Does the complexity of the ownership structure of multinational enterprises' (MNEs) serve tax avoidance? We use firm-level cross-country data to show that affiliates belonging to more complex MNEs are more likely to bunch around zero profit, which is consistent with complexity enabling tax avoidance by multinationals. Our results show that only the more complex MNEs shift profits away from their high-tax affiliates, while MNEs with flat ownership structures do not display such pattern.
ER -