Abstract
This study relies on banking market consolidation via mergers and acquisitions (M&As) to examine banks’ role in intermediating corporate tax planning activities through offshore tax haven operations. After bank M&As, the clients of target banks “involuntarily” switch their banking partners to significantly larger banks (i.e., acquiring banks) with greater global presence and financial expertise that can provide better tax planning services for these clients. We predict and find that after bank M&As, the clients of target banks significantly increase their tax haven operations; additionally, this increase is greater when the acquiring bank is a universal bank that offers comprehensive financial services and when its pre-existing clients engage more aggressively in offshore tax haven operations. We also provide direct evidence that, after bank M&As, the clients of target banks expand their operations into new offshore tax haven countries where the acquiring banks or the acquiring banks’ pre-existing clients have operations.
| Original language | English |
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| Publication status | Published - 1 Jun 2019 |
| Event | 42nd Annual Conference of the Canadian Academic Accounting Association (2019 CAAA Annual Conference): Mind the GA(A)P - Ottawa Marriott Hotel, Ottawa, Canada Duration: 30 May 2019 → 1 Jun 2019 https://www.caaa.ca/en/news-and-events/caaa-annual-conference-2019-mind-the-ga-a-p/ https://www.caaa.ca/media/234594/caaa-annual-conference-program-online-pdf-2019-05-14.pdf |
Conference
| Conference | 42nd Annual Conference of the Canadian Academic Accounting Association (2019 CAAA Annual Conference) |
|---|---|
| Country/Territory | Canada |
| City | Ottawa |
| Period | 30/05/19 → 1/06/19 |
| Internet address |
Bibliographical note
Research Unit(s) information for this publication is provided by the author(s) concerned.Research Keywords
- Tax haven
- tax avoidance
- banking market consolidation
- tax planning intermediation
