New paper from @gabriel_zucman cited by @Ed_Miliband showing that the idea that companies are mobile is wrong. They shift profits, but it’s much harder to shift jobs/factories - so govts shouldn’t be so focused on cutting corporate tax rates. http://gabriel-zucman.eu/files/TWZ2018.pdf … @alexcobham
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Yes, the
@LudvigWier@TTorslov@gabriel_zucman findings are enormously smaller than the IMF study & your reworking. As you say the IMF researchers methodology is mechanical Gives results like Chad losing revenues worth 8% of GDP, Zambia 5% (without any data on these countries)pic.twitter.com/zCVmkktI6r
Crivelli et al/ Cobham & @petr_jansky estimate of c $500 bn revenue loss suggests missing profits c$2.5tn?= 2.5x the total (corrected) corporate profits that T,W,Z estimate across all 'tax havens' (including all biz in Irl, Sw, Nl etc). Suggests larger figures overestimates?
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TWZ are looking at a particular part of the problem, ie losses due to foreign affiliates only (and of course includes mechanical components). The interesting question is how this reconciles with the profit shifting of multinationals in their home jurisdictions, e.g. the US losses
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If US multinationals shift profits out of the US (and they do), this means they book profits in foreign subsidiaries (e.g., US-owned firms in Ireland or Puerto Rico), and these profits will show up in our estimates.
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