TRR 266/TAF Research Seminar
On June 11, 2024, Prof. Dr. Christina Elschner (Europa-Universität Viadrina Frankfurt/Oder) presented a paper titled "The Role of Tax Professionals in International Tax Policy" at the TRR 266/TAF Research Seminar.
Summary:
This research examines tax professionals’ positions and their strategic use of arguments when lobbying on international tax policy. We define tax professionals as external tax advisors, law firms, accounting firms as well as associations of these actors. Related to the role of auditors in accounting standard-setting processes, tax professionals are highly skilled experts whose motivations may range between fostering their own business models, backing their clients’ interests, and supporting the regulator’s mission. We use the setting of the OECD Base Erosion and Profit Shifting (BEPS) project and the Inclusive Framework (IF) on BEPS and a sample of about 3,800 comment letters sent to OECD by firms, tax professionals, and civil society members. We find that Big4 tax professionals are more supportive of policy changes that increase the demand for consultancy activities. This group also uses the regulator’s as well as their clients’ arguments (i.e., request for lower enforcement and documentation costs) to positively frame their positions in these cases. Moreover, tax professionals strongly share the firms’ positions. Similar positions and arguments with civil society members tend to exist only among non-Big4 tax professionals. Finally, tax professionals most frequently highlight costs related to tax complexity independent of the respective policy channel. Our results should be of interest for tax regulators around the globe.
