Title: The effect of transfer pricing and tax haven on cross-border acquisition

Authors: Lilik Adik Kurniawan; Ratna Wardhani

Addresses: Faculty of Economics and Business, Accounting Department, University of Indonesia, Depok, 16424, Indonesia ' Faculty of Economics and Business, Accounting Department, University of Indonesia, Depok, 16424, Indonesia

Abstract: This study aims to investigate the effect of transfer pricing and tax incentive from tax haven countries on the possibility of cross-border company acquisition. This study examines the acquisition activities in Asia in the period of 2012-2014. By using a sample of non-financial companies with a total of 1562 observations, this study shows that transfer pricing affects the probability of the company to do a cross-border acquisition. This study also indicates that the probability of companies performing cross-border acquisition is smaller if the target company is located in a tax haven country.

Keywords: transfer pricing; tax haven; tax avoidance; cross-border acquisition; Asia.

DOI: 10.1504/IJTGM.2022.120898

International Journal of Trade and Global Markets, 2022 Vol.15 No.1, pp.3 - 11

Received: 13 Feb 2020
Accepted: 01 Jul 2020
Published online: 16 Feb 2022 *

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