Tax havens reexamined: The impact of global digital tax reforms on international taxation
1 Louisiana State University, Baton Rouge, Louisiana.
2 Independent Researcher, Ohio, USA.
Review
World Journal of Advanced Science and Technology, 2024, 05(02), 001–012.
Article DOI: 10.53346/wjast.2024.5.2.0031
Publication history:
Received on 19 February 2024; revised on 28 March 2024; accepted on 30 March 2024
Abstract:
This review delves into the evolving landscape of tax havens in the wake of comprehensive digital tax reforms. This study scrutinizes the implications of global efforts to address tax evasion and profit shifting, particularly in the context of the digital economy. With the proliferation of digital services and cross-border transactions, traditional tax frameworks have struggled to capture the economic activities of multinational corporations operating in cyberspace. Consequently, tax havens have emerged as facilitators of aggressive tax planning strategies, exacerbating global tax inequalities and eroding fiscal sovereignty. Against this backdrop, the study analyzes the efficacy and repercussions of recent digital tax reforms spearheaded by international organizations and individual nations. It examines the implementation challenges, compliance burdens, and potential loopholes associated with these reforms. Moreover, the research evaluates the impact of digital tax measures on the behavior of multinational enterprises, exploring their responses in terms of tax planning strategies and business models. Furthermore, the study investigates the broader implications of digital tax reforms on international taxation dynamics, including their influence on tax competition, investment flows, and economic development. Special attention is paid to the implications for developing countries, which often bear the brunt of revenue losses resulting from profit shifting to tax havens. By synthesizing empirical evidence, policy analysis, and theoretical insights, this study offers a comprehensive reevaluation of tax havens in the digital age. It sheds light on the complex interplay between technological advancements, regulatory frameworks, and global economic dynamics shaping contemporary tax landscapes.
Keywords:
Tax Havens; Digital Tax Reforms; International Taxation; Profit Shifting; Multinational Enterprises; Tax Competition
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