A Review of International Management Research on Corporate Taxation

Since international economic liberalization over the past decades has increased the scope for corporate tax arbitrage and such arbitrage has been increasingly scrutinized, taxes have become a more important managerial issue in multinational enterprises (MNEs) and thus a topic of interest for international management (IM) studies. We provide an exploratory overview of the main foci and findings of the resulting body of research, outline how these foci and findings compare to those of international corporate taxation studies in adjacent fields, and propose an agenda for future IM research on corporate taxation. We find that extant IM research has focused on four types of tax-related acts--i.e., income shifting, international relocations of headquarters, internationalization of operational activities, and tax evasion--and identify three important avenues for future research. These avenues concern the use of better operationalizations of corporate income tax burdens and tax havens, the further study of the effects of tax-related formal and informal institutions, and the study of tax-related corporate political activity. More generally, our review shows that, rather than being a mere financial issue, international corporate taxation has various strategic, behavioral, and political dimensions that warrant more attention from IM scholars. Keywords Corporate taxation * International management * Literature review
1 Introduction Since corporate tax rules historically have been determined at the national level and have been aligned only partly through international tax treaties, firms have long been able to [...]