Quotation Riedl, Aleksandra, Rocha-Akis, Silvia. 2009. Testing the Tax Competition Theory: How Elastic are National Tax Bases in OECD Countries?, CESifo Working Paper No. 2669.


RIS


BibTeX

Abstract

To what extent do countries' corporate income tax (CIT) rates attract foreign tax bases? What are the revenue implications of a unilateral tax reduction when tax bases are internationally mobile? These questions are explored using a panel of annual data from 17 OECD countries spanning the period 1982 to 2005. We find significant international fiscal externalities in the form of CIT-induced resource flows. The magnitude, however, indicates that the extent of international corporate tax base mobility is rather modest. Moreover, we find that, on average, a unilateral CIT reduction results in a less-than-proportional increase in the CIT base, thus reducing CIT revenues. The results are robust across a wide range of specifications and point to potential gains from international tax policy coordination.

Tags

Press 'enter' for creating the tag

Publication's profile

Status of publication Published
Affiliation WU
Type of publication Working/discussion paper, preprint
Language English
Title Testing the Tax Competition Theory: How Elastic are National Tax Bases in OECD Countries?, CESifo Working Paper No. 2669
Year 2009
URL http://www.cesifo-group.de/pls/guestci/download/CESifo%20Working%20Papers%202009/CESifo%20Working%20Papers%20June%202009/cesifo1_wp2669.pdf

Associations

People
Riedl, Aleksandra (Former researcher)
Rocha-Akis, Silvia (Former researcher)
Organization
Department of Economics (Kartal) (Details)
Institute for Economic Geography and GIScience IN (Details)
Google Scholar: Search