The Cost and Benefits of Tax Treaties with Investment Hubs: Findings from Sub-Saharan Africa

Author/Editor:

Sebastian Beer ; Jan Loeprick

Publication Date:

October 24, 2018

Electronic Access:

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Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary:

This paper investigates the costs and benefits of concluding double tax treaties with investment hubs. Based on a sample of 41 African economies from 1985–2015, the results suggest that signing treaties with investment hubs is not associated with additional investments; yet, these treaties tend to come with nonnegligible revenue losses. Building on a theoretical model, the paper investigates the role of treaty shopping in driving nominal investment flows and provides indirect evidence for its importance in the sample

Series:

Working Paper No. 18/227

Subject:

English

Publication Date:

October 24, 2018

ISBN/ISSN:

9781484378007/1018-5941

Stock No:

WPIEA2018227

Price:

$18.00 (Academic Rate:$18.00)

Format:

Paper

Pages:

38

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