The Role of Tax Expenditures in Enabling Illicit Financial Flows
The role tax expenditures play in fostering or facilitating illicit financial flows has so far not been studied extensively. We provide an explorative overview of the linkages between tax expenditures and illicit financial flows in both source and recipient countries. In a second step, we focus on t...
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| Format: | Article |
| Language: | English |
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Institut de Hautes Études Internationales et du Développement
2024-06-01
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| Series: | Revue Internationale de Politique de Développement |
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| Online Access: | https://journals.openedition.org/poldev/6245 |
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| author | Christian von Haldenwang Lucas Millán-Narotzky Irma Mosquera Valderrama Agustín Redonda |
| author_facet | Christian von Haldenwang Lucas Millán-Narotzky Irma Mosquera Valderrama Agustín Redonda |
| author_sort | Christian von Haldenwang |
| collection | DOAJ |
| description | The role tax expenditures play in fostering or facilitating illicit financial flows has so far not been studied extensively. We provide an explorative overview of the linkages between tax expenditures and illicit financial flows in both source and recipient countries. In a second step, we focus on three kinds of mechanisms. In source countries we analyse the role of special economic zones and tax expenditures that target the extractive sector. In recipient countries we study the use of patent boxes and related mechanisms to attract intangible assets. Bilateral tax treaties, meanwhile, can act as facilitators of illicit financial flows because they provide legal devices with which to shift profits away from source countries, and add another layer of complexity to the tax system. To address the use and abuse of tax expenditures in this context, the transparency, tax certainty and simplicity of tax systems should be strengthened by any government trying to protect its tax base. |
| format | Article |
| id | doaj-art-b8ffdade14724beea872b11973e1e025 |
| institution | OA Journals |
| issn | 1663-9375 1663-9391 |
| language | English |
| publishDate | 2024-06-01 |
| publisher | Institut de Hautes Études Internationales et du Développement |
| record_format | Article |
| series | Revue Internationale de Politique de Développement |
| spelling | doaj-art-b8ffdade14724beea872b11973e1e0252025-08-20T01:56:06ZengInstitut de Hautes Études Internationales et du DéveloppementRevue Internationale de Politique de Développement1663-93751663-93912024-06-011710.4000/11q99The Role of Tax Expenditures in Enabling Illicit Financial FlowsChristian von HaldenwangLucas Millán-NarotzkyIrma Mosquera ValderramaAgustín RedondaThe role tax expenditures play in fostering or facilitating illicit financial flows has so far not been studied extensively. We provide an explorative overview of the linkages between tax expenditures and illicit financial flows in both source and recipient countries. In a second step, we focus on three kinds of mechanisms. In source countries we analyse the role of special economic zones and tax expenditures that target the extractive sector. In recipient countries we study the use of patent boxes and related mechanisms to attract intangible assets. Bilateral tax treaties, meanwhile, can act as facilitators of illicit financial flows because they provide legal devices with which to shift profits away from source countries, and add another layer of complexity to the tax system. To address the use and abuse of tax expenditures in this context, the transparency, tax certainty and simplicity of tax systems should be strengthened by any government trying to protect its tax base.https://journals.openedition.org/poldev/6245tax and developmentcommoditiesillicit financial flows (IFFs)trade mispricingglobal tax governancespecial economic zones |
| spellingShingle | Christian von Haldenwang Lucas Millán-Narotzky Irma Mosquera Valderrama Agustín Redonda The Role of Tax Expenditures in Enabling Illicit Financial Flows Revue Internationale de Politique de Développement tax and development commodities illicit financial flows (IFFs) trade mispricing global tax governance special economic zones |
| title | The Role of Tax Expenditures in Enabling Illicit Financial Flows |
| title_full | The Role of Tax Expenditures in Enabling Illicit Financial Flows |
| title_fullStr | The Role of Tax Expenditures in Enabling Illicit Financial Flows |
| title_full_unstemmed | The Role of Tax Expenditures in Enabling Illicit Financial Flows |
| title_short | The Role of Tax Expenditures in Enabling Illicit Financial Flows |
| title_sort | role of tax expenditures in enabling illicit financial flows |
| topic | tax and development commodities illicit financial flows (IFFs) trade mispricing global tax governance special economic zones |
| url | https://journals.openedition.org/poldev/6245 |
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