The role of anti-tax avoidance in tax base flow and international tax competition

By constructing the profit shifting model for MNCs, this study uses transfer pricing rules and bilateral tax conventions to examine the impact of anti -avoidance system on a country's corporate income tax base. Based on the balanced panel data of 50 countries from 2000 to 2013, we use the SYS-GMM method and find that the transfer pricing rules of neighboring countries significantly reduces the tax base of a country, while the impact of bilateral tax agreements on a country's tax base is slight. During the sample period, the management level of international anti -avoidance is improved, while the degree of tax competition among countries becomes more intense. Moreover, we show that anti -avoidance measures can reduce the phenomenon of tax avoidance for intangible assets.