Template-Type: ReDIF-Paper 1.0


Author-Name: Dominika Langenmayr 
Author-X-Name-First: Dominika 
Author-X-Name-Last: Langenmayr 

Author-Name: Lennard Zyska
Author-X-Name-First: Lennard
Author-X-Name-Last: Zyska
Title: Avoiding Taxes: Escaping the Exchange of Information: Tax Evasion via Citizenship-by-Investment
	
Abstract: With (automatic) exchange of tax information among countries now common,
tax evaders have had to find new ways to hide their offshore holdings. One such
way are citizenship-by-investment programs, which offer foreigners a new passport
for a local investment or a fixed fee. We show analytically that high-income
individuals acquire a new citizenship to lower the probability that their tax evasion
is detected through information exchange. Using data on cross-border bank
deposits, we find that deposits in tax havens increase after a country starts offering
a citizenship-by-investment program, providing indirect evidence that tax
evaders use these programs.

Length:41 pages
Creation-Date:  2021-03
File-URL: http://www.bgpe.de/texte/DP/204_Langenmayr_Zyska.pdf
File-Format: Application/pdf
File-Function: First version, 2021
Number: 204
Classification-JEL:H26, H24, F53, K37

Keywords: Citizenship-by-investment programs, tax havens, tax evasion

Handle: RePEc:bav:wpaper:204_LangenmayrZyska