Tax governance: the balance between tax regulatory requirements and societal expectations

J. Christian Plesner Rossing (The University of Tampa, USA), Thomas Riise Johansen (Copenhagen Business School, Denmark) and Thomas C. Pearson (University of Hawaii at Manoa, Honolulu, USA) published in International Journal of Corporate Governance Volume 10 Number 3/4 (2019)

Abstract

In October 2012, Starbucks UK branch became the subject of massive public criticism over alleged tax avoidance. Despite Starbucks arguing that its transfer pricing practices were in full compliance with regulation, public pressure led Starbucks to overpay its UK taxes on international transfer pricing beyond the regulatory requirements.

This behaviour contradicts the current literature in which international transfer pricing is portrayed as a tool for aggressive tax management or an exercise of regulatory compliance.

It is further argued that boards and top management of multinational enterprises (MNEs) can no longer approach tax governance as a purely technical, regulation-driven discipline to be addressed only by accounting staff and tax consultants. Instead, its pivotal role in the social contract between an MNE and its stakeholders needs to be recognised.

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Multinational enterprises in time and space: The effect of trade policy shocks

a column by Stefania Garetto, Lindsay Oldenski and Natalia Ramondo for VOX: CEPR’s Policy Portal

Multinational enterprises play an important role in coordinating production around the globe.

This column presents a dynamic quantitative model of multinational enterprise expansion that can be used to analyse the effects of policies that affect the cost of the operations of such firms. It uses this model to estaimte the impact of potential implementations of Brexit.

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