Coercion in international tax cooperation: identifying the prerequisites for sanction threats by a great power
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In: Review of International Political Economy, Vol. 23, No. 3, 03.05.2016, p. 511-541.
Research output: Journal contributions › Journal articles › Research › peer-review
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TY - JOUR
T1 - Coercion in international tax cooperation
T2 - identifying the prerequisites for sanction threats by a great power
AU - Hakelberg, Lukas
N1 - Publisher Copyright: © 2016 Informa UK Limited, trading as Taylor & Francis Group.
PY - 2016/5/3
Y1 - 2016/5/3
N2 - Tax cooperation puts offshore centers worse off, as their compensation for forgone profits is a hard political sell, and unlikely to produce the same spillover effects on wages and employment as the attraction of foreign tax base. Coercion by a great power thus seems to be a prerequisite for successful international cooperation in tax matters. Great power status is based on internal market size. Governments become substantially more likely to use this power through sanction threats against tax havens when two factors coincide: (1) domestic constraints preventing a shift of the tax burden to labor and consumption and (2) scope for redistributive cooperation benefitting great power banks or multinationals. Hypotheses are tested in an analysis of tax negotiations at OECD level between 1996 and 2014.
AB - Tax cooperation puts offshore centers worse off, as their compensation for forgone profits is a hard political sell, and unlikely to produce the same spillover effects on wages and employment as the attraction of foreign tax base. Coercion by a great power thus seems to be a prerequisite for successful international cooperation in tax matters. Great power status is based on internal market size. Governments become substantially more likely to use this power through sanction threats against tax havens when two factors coincide: (1) domestic constraints preventing a shift of the tax burden to labor and consumption and (2) scope for redistributive cooperation benefitting great power banks or multinationals. Hypotheses are tested in an analysis of tax negotiations at OECD level between 1996 and 2014.
KW - business power
KW - domestic constraints
KW - FATCA
KW - redistributive cooperation
KW - tax cooperation
KW - Politics
UR - http://www.scopus.com/inward/record.url?scp=84955064803&partnerID=8YFLogxK
U2 - 10.1080/09692290.2015.1127269
DO - 10.1080/09692290.2015.1127269
M3 - Journal articles
AN - SCOPUS:84955064803
VL - 23
SP - 511
EP - 541
JO - Review of International Political Economy
JF - Review of International Political Economy
SN - 0969-2290
IS - 3
ER -