Shu-Yi Oei

An innovative empirical scholar of global taxation, data, and the gig economy

Shu-Yi Oei, a scholar of tax law and policy and economic regulation, joined the faculty on Jan. 1 as the David T. Zhang Professor of Law. She previously was professor of law and Dean’s Distinguished Scholar at Boston College Law School.

An innovative and prolific scholar well known for her work on international taxation and taxation of the gig economy, Oei has focused her recent scholarship on empirical analysis of global tax developments and transparency and privacy in international tax enforcement. She has also written extensively on technology, data and information, human capital investment, and social insurance.

Also a highly regarded teacher, Oei received the 2014 Felix Frankfurter Distinguished Teaching award at Tulane Law School, where she began her academic career and was the inaugural holder of the Hoffman F. Fuller Professorship in Tax Law. She is teaching International Taxation in the spring semester.

Oei, whose research and teaching are informed by almost six years years of private practice that included advising clients on federal, state, and cross-border tax matters, transactional tax planning, and litigation, is an elected fellow of the American College of Tax Counsel and served as the U.S. National Reporter to the European Association of Tax Law Professors and International Academy of Comparative Law General Congress. In 2018 she chaired the American Association of Law Schools Tax Section. She is a co-author, with Duke Law Professors Richard Schmalbeck and Lawrence Zelenak, of Federal Income Taxation (6th ed., Wolters Kluwer, forthcoming)(also with Sarah. B. Lawsky).

“I have followed Shu-Yi Oei’s career from nearly its very beginning and have always been impressed by her careful analysis of the details of the federal income tax and by her imagination in finding new and interesting angles from which to evaluate both tax and other related issues,” says Schmalbeck, the Simpson Thacher & Bartlett Professor of Law.

“When Larry Zelenak and I were considering adding a third co-author to the next edition of our income-tax casebook, we independently decided that Shu-Yi Oei was the first person we should ask. We were very pleased when she accepted the invitation, and I am simply delighted that she accepted Duke’s offer of a position on our faculty.”

Adds Zelenak, the Pamela B. Gann Professor of Law: “From the latest developments in international tax evasion, to the tax lives of Uber drivers, Shu-Yi’s scholarship identifies emerging issues in tax policy and administration and subjects them to thoughtful and creative analysis. Both in terms of the topics she addresses and the depth of her analyses, her work is consistently on the cutting edge of tax scholarship.”

For her part, Oei is equally excited to be at Duke, with its faculty strength in both tax and international law. “Larry and Rich have been great mentors and great colleagues over the years,” she says. “I think the international tax programming at Duke is just spectacular. And I’ve always been the person who is interested in more than just tax. Having a group of international scholars to engage with is going to be a real treat.”

A creative and insightful empiricist

Oei earned both her JD and a master of theological studies at Harvard after attending Brown University, where she majored in economics and religious studies and graduated magna cum laude. She is currently a PhD candidate in sociology at Boston College, focusing her research on global and transnational sociology.

In her practice at Bingham McCutchen in Boston from 2003 to 2009, Oei engaged in federal and international transactional tax work and represented clients before the Massachusetts Department of Revenue and in the federal courts. “It allowed me to see both sides of a sophisticated tax practice — the upfront planning and then the litigation when it all goes wrong,” she says.

The international dimension of her practice was particularly instructive in the classroom after Oei joined the Tulane Law faculty in 2009 and began teaching a course on international taxation. Her research agenda, which initially addressed questions of domestic policy, gradually broadened to also include international matters. “Part of it was that I got interested in data,” she says. “And once you get into data, you can’t stop at the border. The analysis becomes transnational very quickly.”

“Professor Oei is such an intellectually exciting colleague — her creativity, insights, energy, and analytical depth drive her accomplishments in both her research and the classroom.” 

— Boston College Law School Professor and Interim Dean Diane Ring

Oei applies a wide range of empirical techniques, including quantitative methods, qualitative interviewing, and content analysis, to a research agenda that addresses a similarly broad range of issues, many of them sharply impacted by data proliferation and all with an eye on improving system design. They include the motivations and implications of developing nations’ membership in a new, cooperative international tax order; the effect of a series of well-publicized leaks of tax data on policy; how data availability is affecting informal latitude, or slack, in the law; Uber and Lyft drivers’ tax concerns and comprehension as seen in online forum discussions; the impact of tax code amendments regarding independent contractors on gig workers and workplaces; and how U.S. tax laws are actually drafted, as revealed by interviews with government tax counsel.

Boston College Law School Professor and Interim Dean Diane Ring, one of Oei’s most frequent collaborators and her tax professor at Harvard, praised her former faculty colleague’s curiosity and acuity.

“Professor Oei is such an intellectually exciting colleague — her creativity, insights, energy, and analytical depth drive her accomplishments in both her research and the classroom,” Ring says. “Through our joint research projects, we have been able to explore a wide range of ultimately connected issues in tax policy from human capital to leaks to international tax regime design. The same dedication, frankness, and dynamism that characterize her scholarly life also frame her work in the classroom as she aims to inspire students to push themselves and think critically.”

Examining a revolution in cross-border taxation

Three of Oei’s recent papers written independently and with Ring investigate the origins, establishment, and implications of what they refer to as the “revolution in cross-border tax information exchange and reporting” that has emerged since 2008 as nations attempt to stabilize revenues and minimize tax evasion.

“While this dramatic shift was the product of multiple forces and events, a fundamental reality is that politics, technology, and law intersected to drive the shift to the point where nation-states will now transmit and receive from each other significant ongoing flows of taxpayer information,” they write in “When Data Comes Home: Next Steps in International Taxation’s Information Revolution,” 64(4) McGill L.J. 707 (2020). But they caution that multilateral cooperation can be undermined by domestic policy decisions that affect the use of the data and enforcement of international standards: “Awareness of the possible pitfalls and their determinants can help policymakers identify problem areas, protect taxpayers, and improve outcomes.”

In “Leak-Driven Law,” 65 UCLA L. Rev. 532 (2018), Oei and Ring offer a novel study of one of the new tax order’s key precipitating phenomena: the series of explosive data leaks that exposed the way many multinational corporations and wealthy individuals were using tax havens and offshore accounts to minimize or evade taxes, often with the cooperation of international banks. The leaks sparked intense public and political scrutiny, some prosecutions, and changes in policies and law. In the wake of 2008 leaks regarding the actions of UBS LGT Banks, for example, the authors note that the United States tightened up enforcement of foreign asset reporting and in 2010 enacted the Foreign Account of Tax Compliance Act (FATCA). And in 2015, the G20 nations struck a multilateral agreement, the BEPS Inclusive Framework, listing steps to tackle cross-border tax avoidance to which 139 countries have since signed on.

In addition to parsing the type of data disclosed in each case, how and by whom it was leaked (by whistleblowers, hackers, or governments), and how it was disseminated publicly, Oei and Ring examine the benefits and risks of tax leaks. For governments, they observe, leaks can be akin to free audits, illuminate previously unnoticed evasion practices, and change the “evasion calculus” of certain taxpayers, and in those ways can facilitate improvements in international enforcement practices more broadly.

But the risks they identify include agenda capture by leakers and intermediaries (such as Wikileaks) who control, respectively, what is leaked, and when and how much of the data is made public. “In this sense, therefore, leaked data is not just unadulterated free information,” they write. “In relying on leaked data, tax authorities and governments run the risk of being unduly influenced by the interests of and framings employed by these actors without genuine appreciation of the risks.” The shock value of leaks, they caution, can also trigger hasty or reactionary legislative responses that can ensnare the wrong taxpayers — a pitfall of FATCA — or resonate unevenly across nations.

Oei and Ring urge governments to become more sophisticated consumers of leaked data, subject policy responses to cost-benefit analysis, and independently evaluate their enforcement goals. “The question is not simply how governments can use information from leaks to sanction bad behavior, make decisions, and design laws,” they conclude. “Rather, the question is how the actions and responses of leakers, private citizens, governments, and the media work together to create and promote certain policy outcomes, and how those outcomes should be evaluated, supported, or resisted.”

Oei’s forthcoming article, “World Tax Policy in the World Tax Polity? An event history analysis of OECD/G20 BEPS Inclusive Framework membership,” 47 Yale J. of Int’l L. 199 (2022), examines the proliferation of the Inclusive Framework on BEPS (base erosion and profit shifting) that the G20 nations established in 2015 and is led by the Organisation for Economic Co-operation and Development (OECD). Member countries to the framework commit to reforming their domestic tax laws and treaties to “eliminate tax avoidance, profit shifting, and other harmful behaviors by multinationals that erode domestic tax bases and drain tax revenues,” she writes. But those commitments weigh on developed and developing nations differently and hold questionable benefits for some.

Oei applies world polity theory, which highlights the role of institutions in developing a shared world polity across differently situated countries, to more than 100 non-G20 nations’ decisions to join the Inclusive Framework, identifying incentives that proved persuasive. A key normative pathway to membership that she identifies is countries’ “socialization” towards multilateral cooperation through participation in other OECD-led tax treaties, such as one that facilitates the automatic exchange of cross-border tax information. But she also points to pressure applied by powerful countries and blocs to entice membership in the framework — notably the threat of being included on the European Union’s “Scoreboard” of tax havens or its “Grey List” of jurisdictions deemed to fall short in implementing international tax standards — that can lead to economic countermeasures like denials of aid or monitoring.

That insight regarding the EU’s somewhat coercive role prompting membership in the Inclusive Framework carries significant implications, Oei writes: “[O]ur new and more inclusive-looking tax world polity, and the isomorphism we are seeing as a result, looks less steeped in inclusivity, representation, and willing cooperation, and more driven by fear of shaming and economic and political repercussions.”

She cautions that if similar factors underpin nations’ agreement to other international tax initiatives, such as the push for a global minimum tax favored by the OECD, G20, and EU, it could undermine “the content, legitimacy, and implementation” of the resulting multilateral agreements. And while acknowledging that OECD leadership in facilitating international tax consensus makes logistical sense, she urges policymakers to be “more attuned to how power dynamics may shape outcomes and how to ensure that such outcomes are procedurally and distributionally just.”

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Spring 2023
Volume 42 No. 1