We investigate the effects of mandatory private Country-by-Country Reporting (CbCR) to European tax authorities on multinational firms’ capital and labor investments as well as their organizational structures. We exploit the threshold-based application of this 2016 disclosure rule to conduct difference-in-differences and regression discontinuity tests. We document increases in capital and labor expenditures in Europe, but these effects are more pronounced in countries with preferential tax regimes. Cross-sectional tests and analysis using consolidated financial data provide evidence consistent with multinational firms reallocating capital across Europe to mitigate increased tax enforcement risk, as well as with CbCR hindering capital investment efficiency. We also find evidence consistent with firms responding to CbCR by reducing organizational complexity. Collectively, our results support the conclusion that mandatory private CbCR causes firms to change real investment activities to substantiate their tax avoidance activities in Europe while reducing the appearance of aggressive tax practices.

中文翻译：

---

私人国别披露的实际影响

我们调查了向欧洲税务机关强制进行的私人国别报告 (CbCR) 对跨国公司的资本和劳动力投资及其组织结构的影响。我们利用 2016 年披露规则的基于阈值的应用来进行差异差异和回归不连续性测试。我们记录了欧洲资本和劳动力支出的增加，但这些影响在税收优惠制度的国家更为明显。使用合并财务数据进行的横截面测试和分析提供的证据与跨国公司在欧洲重新分配资本以减轻增加的税收执法风险以及 CbCR 阻碍资本投资效率一致。我们还发现了与公司通过降低组织复杂性来响应 CbCR 一致的证据。总的来说，我们的结果支持以下结论：强制性私人 CbCR 导致公司改变实际投资活动以证实其在欧洲的避税活动，同时减少激进税收做法的出现。