OECD Tax Policy Studies No. 17 Tax Effects on Foreign Direct Investment: Recent Evidence and Policy Analysis

This publication reports the results of a project examining taxation and foreign direct investment (FDI), with a focus on three areas. Recent empirical studies and models are first reviewed, with the aim of better understanding what factors explain differences in the responsiveness of FDI to taxation, in different country and industry contexts. Second, the publication reports an exchange of views on considerations that are balanced by tax policy makers in the design of rules governing the taxation of inbound and outbound FDI, including increasing pressure to provide "internationally competitive" tax treatment. Third, the publication presents findings from a new framework developed for the project to analyse the implications of tax-planning by multinationals in reducing effective tax rates on cross-border investment. The findings highlight the need to address tax-planning when attempting to measure the "true" tax burden on FDI.Organisation for Economic Co-operation and Development Staff is the author of 'OECD Tax Policy Studies No. 17 Tax Effects on Foreign Direct Investment: Recent Evidence and Policy Analysis', published 2008 under ISBN 9789264038370 and ISBN 926403837X.