Organizational structure and corporate tax burden in the absence of consolidated tax reporting
Bibliographic record
Abstract
This paper examines the impact of the absence of consolidated tax reporting (CTR) on a business group’s overall tax burden, when compared to a standalone firm. Relying on a Chinese setting, where domestic income shifting opportunities exist, but CTR is not permitted, we find that business groups, considered as a single unit, exhibit a higher level of tax burden compared to standalone firms. Mechanism analyses suggest that this effect is largely driven by the inability to offset losses against profits across group members, limited deductibility of certain expenses, and the burden to pay taxes on unrealized internal profits. In additional analysis, we find that the tax disadvantage of business groups is mitigated for those with a greater ability to shift income. Overall, our research contributes to the literature examining the role of organizational structure on firms’ tax burdens and has important implications for policymakers around the world in defining the tax base of business groups.
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How this classification was reachedexpand
Full frame distilled prediction
Teacher imitationNot calibrated prevalence, not ground truth. Human validation pending. Learned from the 10,348 direct Codex labels and 10,348 direct Gemma labels. Candidate is the union of thresholded teacher heads; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels or direct frontier model labels.
Codex and Gemma teacher scores by category
| Category | Codex | Gemma |
|---|---|---|
| Metaresearch | 0.001 | 0.003 |
| Meta-epidemiology (narrow) | 0.000 | 0.000 |
| Meta-epidemiology (broad) | 0.000 | 0.000 |
| Bibliometrics | 0.001 | 0.002 |
| Science and technology studies | 0.000 | 0.000 |
| Scholarly communication | 0.000 | 0.001 |
| Open science | 0.000 | 0.000 |
| Research integrity | 0.000 | 0.000 |
| Insufficient payload (model declined to judge) | 0.000 | 0.000 |
Machine scores (provisional)
The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.
Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.
score_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from itClassification
machine, unvalidatedMachine predicted; a candidate call from one teacher head, not a consensus.
How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".