# James R. Hines Jr.

Part of a series on :
Taxation :
An aspect of fiscal policy :
Policies
Government revenue
Property tax equalization
Tax revenue
Non-tax revenue
Tax law
Tax bracket
Flat tax
Tax threshold
Exemption
Credit
Deduction
Tax shift
Tax cut
Tax holiday
Tax amnesty
Tax advantage
Tax incentive
Tax reform
Tax harmonization
Tax competition
Tax withholding
Double taxation
Representation
Unions
Medical savings account :
Economics
General Theory
Price effect
Excess burden
Tax incidence
Laffer curve
Optimal tax
Theories
Optimal capital income taxation
Distribution of Tax
Tax rate
Flat
Progressive
Regressive
Proportional :
Collection
Revenue service
Revenue stamp
Tax assessment
Taxable income
Tax lien
Tax refund
Tax shield
Tax residence
Tax preparation
Tax investigation
Tax shelter
Tax collector
Private tax collection
Tax farming :
Noncompliance
General
Tax avoidance
Repatriation tax avoidance
Tax evasion
Tax resistance
Tax shelter
Debtors' prison
Smuggling
Black market
Unreported employment
Corporate
Tax inversion
Transfer mispricing
Base erosion and profit shifting (BEPS)
Double Irish
Dutch Sandwich
Single Malt
CAIA
Locations
Tax havens
Corporate havens
Offshore financial centres (OFCs)
Offshore magic circle
Conduit and sink OFCs
Financial centres
Financial Secrecy Index
Major examples
Ireland as a tax haven
Ireland v. Commission
Leprechaun economics
Liechtenstein tax affair
Luxembourg Leaks
Offshore Leaks
Paradise Papers
Panama Papers
Swiss Leaks
United States as a tax haven
Panama as a tax haven :
Types
Direct
Indirect
Per unit
Ad valorem
Aviation
Airport improvement
Landing
Solidarity
Capital gains
Expatriation
Consumption
Departure
Hotel
Sales
Stamp
Television
Tourist
Value-added
Dividend
Environmental tax
Carbon
Eco-tariff
Landfill
Natural resources consumption
Severance
Steering
Stumpage
Excise
Alcohol
Cigarette
Fat
Meat
Sin
Sugary drink
Tobacco
General
Georgist
Gift
Gross receipts
Hypothecated
Income
Inheritance (estate)
Land value
Luxury
Payroll
Pigouvian
Property
Resource rent
Single
Surtax
Turnover
Use
User charge/fee
Congestion
Fuel
Road/GNSS
Toll
Vehicle miles traveled
Corporate profit
Excess profits
Windfall
Negative (income)
Wealth :
International
Financial transaction tax
ATTAC
Currency transaction tax
European Union Common Consolidated Corporate Tax Base (CCCTB)
Global minimum corporate tax rate
Robin Hood tax
Tobin tax
Spahn tax
Tax equalization
Tax treaty
Exchange of Information
Permanent establishment
Transfer pricing
European Union FTT
Foreign revenue rule :
Trade
Custom
Duty
Tariff
Import
Export
Tariff war
Free trade
Free-trade zone
Trade agreement
ATA Carnet :
Research
Academic
Mihir A. Desai
Dhammika Dharmapala
James R. Hines Jr.
Ronen Palan
Joel Slemrod
Gabriel Zucman
Advocacy groups
Institute on Taxation and Economic Policy (ITEP)
Oxfam (UK)
Tax Foundation (US)
Tax Justice Network (TJN)
Tax Policy Center (US) :
Religious
Church tax
Eight per thousand
Teind
Tithe
Fiscus Judaicus
Leibzoll
Temple tax
Tolerance tax
Jizya
Kharaj
Khums
Nisab
Zakat :
By country
All Countries
List of countries by tax rates
Tax revenue to GDP ratio
Tax rates in Europe
Individual Countries
Albania
Algeria
Argentina
Armenia
Australia
Azerbaijan
Bangladesh
Bhutan
Brazil
Bulgaria
BVI
Canada
China
Colombia
Croatia
Denmark
Finland
France
Germany
Greece
Hong Kong
Iceland
India
Indonesia
Iran
Ireland
Israel
Italy
Japan
Kazakhstan
Lithuania
Malta
Morocco
Namibia
Netherlands
New Zealand
Norway
Pakistan
Palestine
Peru
Philippines
Poland
Portugal
Russia
South Africa
Sri Lanka
Sweden
Switzerland
Taiwan
Tanzania
United Arab Emirates
United Kingdom
United States
Uruguay :
Business portal
Money portal :
vte :
James R. Hines Jr. (born July 9, 1958) is an American economist and a founder of academic research into corporate-focused tax havens, and the effect of U.S. corporate tax policy on the behaviors of U.S. multinationals. His papers were some of the first to analyse profit shifting, and to establish quantitative features of tax havens. Hines showed that being a tax haven could be a prosperous strategy for a jurisdiction, and controversially, that tax havens can promote economic growth. Hines showed that use of tax havens by U.S. multinationals had maximized long-term U.S. exchequer tax receipts, at the expense of other jurisdictions. Hines is the most cited author on the research of tax havens, and his work on tax havens was relied upon by the CEA when drafting the Tax Cuts and Jobs Act of 2017.

## Biography

James Hines was born in Chicago in 1958. He went to Yale University for his B.Sc and M.Sc in 1980. He completed his PhD in Harvard University in 1986. After various teaching and research posts in Princeton University and Harvard University, in 1997 he became Professor of Economics at the University of Michigan. Hines is a research associate of the National Bureau of Economic Research, and a research director of the International Tax Policy Forum.
Hines is the most cited author on research into tax havens, and has co-authored several papers in the § Most important papers on tax havens, including the most cited paper. Hines has testified to Congress on public tax policy on a number of occasions, and is quoted on related issues by the financial media, such as the Tax Cuts and Jobs Act of 2017 ("TCJA").

## Tax haven research
### Hines-Rice paper

In February 1994, Hines and his Harvard PhD student, Eric M. Rice, published their 1990 National Bureau of Economic Research ("NBER") working paper (No. 3477), in the Quarterly Journal of Economics, on the use of tax havens by U.S. multinationals, which contained a number of important findings.
* Base erosion and profit shifting ("BEPS"). Hines-Rice showed U.S. multinationals were using non-traditional tax havens, like Ireland and Singapore, that had large networks of tax treaties (which traditional tax havens are restricted from having), enabling them to avoid corporate taxes in all jurisdictions that had tax treaties with the haven, by a technique they called profit shifting;
* Corporate tax havens. Hines-Rice noted that several of the most favoured locations for U.S. multinationals, such as Ireland, had normal headline corporate tax rates, but their tax regimes enabled accounting techniques to produce much lower effective corporate tax rates (e.g. Ireland was the lowest at 4%); these were the little-understood BEPS tools of the emerging corporate tax havens;
* Definition of a tax haven. Hines-Rice felt the variations between havens was too material for a single definition, beyond a requirement for low effective tax rates; distortions from profit shifting led them to note proxies, including: the GDP-per-capita proxy, and the corporate profitabity proxy; in June 2018, these tools were used to show that Ireland was the largest tax haven;
* U.S. as a beneficiary from tax havens. An unexpected conclusion from Hines-Rice was that: low foreign tax rates [from tax havens] ultimately enhance U.S. tax collections; by paying little/no foreign taxes, U.S. multinationals had avoided building up foreign tax credits; the 15.5% Tax Cuts and Jobs Act of 2017 levy would prove this finding again in 2017.
The 1994 Hines-Rice paper is recognised as the first important paper into BEPS and tax havens, and it is the most cited research paper in history on tax havens. The 1994 Hines-Rice paper has been cited by all subsequent most cited research papers into tax havens, including by Desai, Dharmapala, Slemrod, and Zucman.
The two most recent U.S. congressional investigations into tax havens: the 2008 investigation by the Government Accountability Office, and the 2015 investigation by the Congressional Research Service, identify the 1994 Hines-Rice paper as the first credible list of global tax havens, and the first quantitative analysis of what constitutes a tax haven.

### Subsequent research

His subsequent 2007–2011 papers on tax havens showed that major tax havens, including Ireland, Singapore, Bermuda, Luxembourg, Hong Kong, were well governed and prosperous economies, from being tax havens: Tax havens are successful players in the world economy. He also asserted that tax havens could stimulate economic activity in nearby high-tax countries, by addressing issues in their tax systems, however this conclusion has been controversial and has drawn criticism from advocates of tax justice as being supportive of corporate tax avoidance by multinationals.
While Hines always avoided constructing overly specific or quantitative definitions of a tax haven, because of the variability in the types of economies that he had identified as tax havens, Hines does use a general definition that he employed during research with fellow tax-haven expert, Dhammaka Dharmapala, in 2009:
   Tax havens are typically small, well-governed states that impose low or zero tax rates on foreign investors.
In November 2017, Hines was awarded the Daniel M. Holland Medal by the National Tax Association for his work, the second youngest winner in the medal's history.
In December 2017, his papers were cited by Harvard Professor Mihir A. Desai as ones that: changed the field and provided the roadmap for much of the next thirty years.

## Multinational tax research

As well as his work on BEPS and on tax havens, Hines is known for research into how U.S. corporate taxation, and the marginal rate of U.S. corporation tax, drives the behaviours of U.S multinationals. Hines has been a strong advocate of moving the U.S. to a "territorial" tax model. In 2016, Hines, working with German academics, showed that German multinationals make little use of tax havens because the German corporate taxation system follows a "territorial" model. Hines cites the example of Ireland, a country featured on all of Hines' tax haven lists, which has rarely attracted firms from "territorial" taxation systems.
His research in this area was cited, although sometimes controversially so, by the Council of Economic Advisors ("CEA") in drafting the TCJA legislation in 2017; and advocating for reducing U.S. corporate taxes and moving to a hybrid "territorial" tax system framework, in order to drive U.S employment and wage growth.

## Hines tax havens
### Hines-Rice 1994 list

Because it is cited as the first coherent academic list of tax havens, the 41 jurisdictions from Appendix 2 in Hines-Rice (1994) are listed below, in the three sub-categories Hines-Rice used. The 7 major tax havens identified by Hines-Rice, who represent over 89% of tax haven GDP, are marked with a dagger (†).
Hines-Rice note that the U.S. IRS had identified 29 of their list as potential tax havens in 1987:
* Antigua & Barbuda
* Bahamas
* Bahrain
* Barbados
* Belize
* Bermuda
* British Virgin Islands
* Cayman Islands
* The Channel Islands
* Cook Islands
* Cyprus
* Gibraltar
* Grenada
* Hong Kong†
* Ireland†
* Isle of Man
* Liberia†
* Liechtenstein
* Luxembourg
* Montserrat
* Netherlands Antilles
* Panama†
* St. Kitts
* St. Vincent
* Singapore†
* Switzerland†
* Turks & Caicos
* U. K. Caribbean Islands
* Vanuatu
Hines-Rice note that Beauchamp had identified 7 of their list as potential tax havens in 1983:
* Anguilla
* Andorra
* Jordan
* Lebanon†
* Macao
* Monaco
* St. Martin
Hines-Rice note that Doggart had identified 5 of their list as potential tax havens in 1983:
* Dominica
* Maldives
* Malta
* Marshall Islands
* St. Lucia

### Hines 2010 list

In a 2010 research paper, Hines produced a revised list of 52 tax havens, and also a method of quantifying and ranking the largest of them (Hines did not rank the whole list). Only two of the ten largest havens in Hines' 2010 list appeared in the OECD's 2000 list of tax havens (by 2017, the OECD list only contained Trinidad & Tobago). A major quantitative study in July 2017 study by the University of Amsterdam's CORPNET group, produced a list of havens that matched nine of the ten largest havens in Hines' list, but split into two types of haven: Conduit and Sinks. Another major quantitative study in June 2018 by Gabriel Zucman (et alia), produced a list whose ten largest havens also matched nine of Hines' top ten havens from 2010. Zucman calculated that Ireland had now become the largest of the ten major havens (Ireland's largest firms, Apple, Google and Facebook were smaller in 2010).
Ten largest havens, as specifically estimated by Hines, from the Hines 2010 list of 52 tax havens:
* Luxembourg*‡
* Cayman Islands*‡
* Ireland*†
* Switzerland*†
* Bermuda*‡
* Hong Kong*‡
* Jersey‡Δ
* Netherlands*†
* Singapore*†
* British Virgin Islands*‡Δ
(*) Identified as one of the largest 10 corporate tax havens on the Zucman-Tørsløv-Wier 2018 list in 2018 (Cayman and the British Virgin Islands appear as Caribbean). (†) Identified as one of the 5 Conduits (Ireland, Singapore, Switzerland, the Netherlands, and the United Kingdom), by CORPNET in 2017. (‡) Identified as one of the largest 5 Sinks (British Virgin Islands, Luxemburg, Hong Kong, Jersey, Bermuda), by CORPNET in 2017. (Δ) Identified on the first, and the largest, OECD 2000 list of 35 tax havens (the OECD list only contained Trinidad & Tobago by 2017).
The full list of 52 tax havens from the Hines 2010 list, are shown below (Hines did not rank the full list, only the largest):
* AndorraΔ
* Anguilla‡Δ
* Antigua and BarbudaΔ
* ArubaΔ
* Bahamas‡Δ
* Bahrain↕Δ
* Barbados↕Δ
* Belize‡Δ
* Bermuda‡
* British Virgin Islands‡Δ
* Cayman Islands‡
* Cook IslandsΔ
* Costa Rica
* Cyprus‡
* Djibouti
* DominicaΔ
* Gibraltar‡Δ
* Grenada↕Δ
* GuernseyΔ
* Hong Kong‡
* Ireland†
* Isle of ManΔ
* Jersey‡Δ
* Jordan
* Lebanon
* Liberia‡Δ
* Liechtenstein‡Δ
* Luxembourg‡
* Macao↕
* MaldivesΔ
* Malta‡
* Marshall Islands‡↕Δ
* Mauritius‡
* Micronesia
* Monaco‡Δ
* MontserratΔ
* Nauru‡Δ
* Netherlands† & AntillesΔ
* NiueΔ
* Panama↕Δ
* Samoa‡↕Δ
* San Marino
* Seychelles‡Δ
* Singapore†
* St. Kitts and NevisΔ
* St. Lucia↕Δ
* St. Martin
* St. Vincent and the Grendines‡Δ
* Switzerland†
* TongaΔ
* Turks and CaicosΔ
* VanuatuΔ
(†) Identified as one of the 5 Conduits by CORPNET in 2017; the above list has 4 of the 5. (‡) Identified as one of the largest 24 Sinks by CORPNET in 2017; the above list has 21 of the 24. (↕) Identified on the European Union's first 2017 list of 17 tax havens; the above list contains 8 of the 17. (Δ) Identified on the first, and the largest, OECD 2000 list of 35 tax havens (the OECD list only contained Trinidad & Tobago by 2017); the above list contains 34 of the 35.