Assessing the risk of profit shifting among the suppliers to Danish municipalities

Purpose: An increasing number of Danish municipalities wish to minimize tax avoidance due to profit shifting in their public procurement. To facilitate this effort, this study aims to develop a firm-level indicator to assess the potential risk of profit shifting (PS-risk) from Danish subsidiaries of multinational corporations to subsidiaries in low-tax jurisdictions. Design/methodology/approach: Drawing from previous research, PS-risk is assumed to depend on the maximum difference in the effective corporate tax rate between the Danish subsidiary and other subsidiaries under the global ultimate owner, in conjunction with the tax regulations relevant to profit shifting. The top 400 contractors in Danish municipalities from 2017 to 2019 are identified and their relative PS-risk is estimated by combining information about corporate ownership structure with country-specific information on corporate tax rates, tax regulations and profit shifting from three independent data sets. Findings: The PS-risk estimates are highly significantly positively correlated across the data sets and show that 17%–23% of the total procurement sum of the Danish municipalities has been spent on contracts with corporations having a medium to high PS-risk. On average, PS-risk is highest for large non-Scandinavian multinational contractors in sectors such as construction, health and information processing. Social implications: Danish public procurers may use the indicator to screen potential suppliers and, if procurement regulations permit, to ensure high-PS-risk bidders document their tax practices. Originality/value: The PS-risk indicator is novel, and to the best of the authors’ knowledge, the analysis provides the first estimate of PS-risk in Danish public procurement

Intra‑Cardiac Flow from Geometry Prescribed Computational Fluid Dynamics:Comparison with Ultrasound Vector Flow Imaging

Purpose This paper investigates the accuracy of blood flow velocities simulated from a geometry prescribed computational fluid dynamics (CFD) pipeline by applying it to a dynamic heart phantom. The CFD flow patterns are compared to a direct flow measurement by ultrasound vector flow imaging (VFI). The hypothesis is that the simulated velocity magnitudes are within one standard deviation of the measured velocities. Methods The CFD pipeline uses computed tomography angiography (CTA) images with 20 volumes per cardiac cycle as geometry input. Fluid domain movement is prescribed from volumetric image registration using the CTA image data. Inlet and outlet conditions are defned by the experimental setup. VFI is systematically measured in parallel planes, and compared to the corresponding planes in the simulated time dependent three dimensional fluid velocity field. Results The measured VFI and simulated CFD have similar flow patterns when compared qualitatively. A quantitative comparison of the velocity magnitude is also performed at specific regions of interest. These are evaluated at 11 non-overlapping time bins and compared by linear regression giving R2 = 0.809, SD = 0.060 m/s, intercept = − 0.039 m/s, and slope = 1.09. Excluding an outlier at the inlet, the correspondence between CFD and VFI improves to: R2 = 0.823, SD = 0.048 m/s, intercept = -0.030 m/s, and slope = 1.01. Conclusion The direct comparison of flow patterns shows that the proposed CFD pipeline provide realistic flow patterns in a well-controlled experimental setup. The demanded accuracy is obtained close to the inlet and outlet, but not in locations far from these