Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/198480
Authors: 
Afrasinei, Mihai-Bogdan
Georgescu, Iuliana Eugenia
Istrate, Costel
Year of Publication: 
2016
Citation: 
[Journal:] CES Working Papers [ISSN:] 2067-7693 [Volume:] 8 [Year:] 2016 [Issue:] 4 [Pages:] 572-596
Abstract: 
The offshore entities have become one of the most efficient solutions for tax avoidance and are used by taxpayers almost all around the world. This paper investigates the influence of the connections (via subsidiaries or shareholders) of Romanian non-listed firms to tax havens on their profitability and effective tax rate. In this regard, we used a sample of 7,167 Romanian firms (3,370 with connections to tax havens and 3,797 without tax havens connections). For statistical analysis, we used the simple and multiple linear regression methods with dummy variables. Results have shown that the presence of Romanian non-listed firms in tax havens significantly influences their profitability and effective tax rate. The firms with connections to tax havens have a return on equity ratio higher, a return on assets ratio lower, a gross profit margin ratio lower, a total assets turnover ratio higher and an effective tax rate lower than companies without connections to such jurisdictions
Subjects: 
tax havens
offshore companies
tax planning
tax optimization
tax avoidance
effective tax rate
JEL: 
F21
F23
M40
Creative Commons License: 
https://creativecommons.org/licenses/by/4.0/
Document Type: 
Article
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