Estimating the Misalignment between the Locations of Profits and Economic Activities of EU’s Banks
| Thesis title in Czech: | Odhad rozdílů mezi lokacemi zisků a ekonomických aktivit EU bank |
|---|---|
| Thesis title in English: | Estimating the Misalignment between the Locations of Profits and Economic Activities of EU’s Banks |
| Academic year of topic announcement: | 2015/2016 |
| Thesis type: | Bachelor's thesis |
| Thesis language: | angličtina |
| Department: | Institute of Economic Studies (23-IES) |
| Supervisor: | prof. Petr Janský, Ph.D. |
| Author: | hidden - assigned by the advisor |
| Date of registration: | 04.06.2015 |
| Date of assignment: | 13.05.2016 |
| Date and time of defence: | 06.09.2016 00:00 |
| Venue of defence: | IES |
| Date of electronic submission: | 29.07.2016 |
| Date of proceeded defence: | 06.09.2016 |
| Opponents: | Bc. Yao Wang, Ph.D. |
| URKUND check: | |
| Guidelines |
| Topic characteristics
In the theses we will focus on the misalignment of profit of financial institutions, namely, banks. The Base Erosion and Profit Shifting is one of the main issues of current taxation we would like to uncover the potential role of financial institutions in this matter. We will analyse existing literature and than introduce our own analysis. Research questions In our analysis We would like to answer following question: • Is there inconsistency between reported profit and real economic activity among banks • How would the resulted tax bases either of countries as a whole or each subsidiary of the bank group differ from the current ones? • How would the resulted tax income of countries and tax burden of banks differ from current one? • Which countries have the largest share of banks profit? Methodology We will use newly available data, which have to be disclosed annually by banks on country-by-country bases. We will simulate the impact of unitary taxation on the tax base on the bank|country level using the employees apportionment factor combined with turnover apportionment factor, which is similar approach as Murphy (2015) introduced in his research and it is actually simplified model as European Union proposed called Common Consolidated Corporate Tax Base (CCCTB). From this computation we will estimate the impact of the unitary taxation on overall income of given country and on the overall tax burden of given bank. We will locate the maximum profit per employee per bank and we will compare the results with the existing list of tax haven. |
| References |
| 1. Cobham, A. & P. Jansky ́ (2015): “Working Paper 42 Measuring misalignment: The location of US multinationals’ economic activity versus the location of their profits.”
2. Cobham, A. & S. Loretz (2014): “Working Paper 27 International Distribution of the Corporate Tax Base : Implications of Different Apportionment Factors under Unitary.” 3. Devereux, M. P & S. Loretz (2008): “The Effects of EU Formula Apportionment on Corporate Tax Revenues.” Institute for Fiscal Studies 29(1)): pp. 1–33. 4. Johannesen, N. & D. T. Larsen (2016): “The Power of Financial Transparency: An Event Study of Country-by-Country Reporting Standards Highlights.” Economics Letters. http://dx.doi.org/10.1016/j.econlet.2016.05.029 5. Murphy, R. (2015): “European Banks’ Country-by-Country Reporting A review of CRD IV.” ax Research LLP Greens / EFA MEPs European Parliament 6. Dyreng, S. D. D. (2014): “Public pressure and corporate tax behaviour WP 14/16.” |
| Preliminary scope of work |
| 1. Introduction
2. Literature review 3. Empirical analysis 4. Discussion 5. Conclusion |