02140cas a2200277 a 4500 AALejournalIMF016198 230101c9999 xx r poo 0 0eng d 5.00 USD 9781513528328 1018-5941 BD-DhAAL BD-DhAAL Beer, Sebastian. Exploring Residual Profit Allocation / Sebastian Beer, Ruud A. Mooij, Shafik Hebous, Michael Keen. Washington, D.C. : International Monetary Fund, 2020. 1 online resource (51 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Schemes of residual profit allocation (RPA) tax multinationals by allocating their 'routine' profits to countries in which their activities take place and sharing their remaining 'residual' profit across countries on some formulaic basis. They have recently and rapidly come to prominence in policy discussions, yet almost nothing is known about their impact on revenue, investment and efficiency. This paper explores these issues, conceptually and empirically. It finds residual profits to be substantial, but concentrated in a relatively few MNEs, headquartered in few countries. The impact on tax revenue of reallocating excess profits under RPA, while adverse for investment hubs, appears beneficial for lower income countries even when the formula allocates by destination-based sales. The impact on investment incentives is ambiguous and specific both to countries and MNE groups; only if the rate of tax on routine profits is low does aggregate efficiency seem likely to increase. Mode of access: Internet Hebous, Shafik. Keen, Michael. Mooij, Ruud A. IMF Working Papers; Working Paper ; No. 2020/049 Full text available on IMF http://elibrary.imf.org/view/journals/001/2020/049/001.2020.issue-049-en.xml IMF e-Library