Rate Cutting Tax Reforms and Corporate Tax Competition in Europe

Beitrag in einer Fachzeitschrift


Details zur Publikation

Autorinnen und Autoren: Heinemann F, Overesch M, Rincke J
Zeitschrift: Economics and Politics
Verlag: Blackwell Publishing Inc.
Jahr der Veröffentlichung: 2010
Band: 22
Heftnummer: 3
Seitenbereich: 498-518
ISSN: 0954-1985
eISSN: 1468-0343
Sprache: Englisch


Abstract


While there is a large and growing number of studies on the determinants of corporate tax rates, the literature has so far ignored the fact that the behavior of governments in setting tax rates is often best described as a discrete choice decision problem. We set up an empirical model that relates a government's decision whether to cut its corporate tax rate to the country's own inherited tax and taxes in neighboring countries. Using comprehensive data on corporate tax reforms in Europe since 1980, we find evidence suggesting that the position in terms of the tax burden imposed on corporate income relative to geographical neighbors strongly affects the probability of rate-cutting tax reforms. Countries are particularly likely to cut their statutory tax rate if the inherited tax is high and if they are exposed to low-tax neighbors.



FAU-Autorinnen und Autoren / FAU-Herausgeberinnen und Herausgeber

Rincke, Johannes Prof. Dr.
Lehrstuhl für Volkswirtschaftslehre, insbesondere Wirtschaftspolitik


Einrichtungen weiterer Autorinnen und Autoren

Zentrum für Europäische Wirtschaftsforschung (ZEW)


Zitierweisen

APA:
Heinemann, F., Overesch, M., & Rincke, J. (2010). Rate Cutting Tax Reforms and Corporate Tax Competition in Europe. Economics and Politics, 22(3), 498-518. https://dx.doi.org/10.1111/j.1468-0343.2010.00375.x

MLA:
Heinemann, Friedrich, Michael Overesch, and Johannes Rincke. "Rate Cutting Tax Reforms and Corporate Tax Competition in Europe." Economics and Politics 22.3 (2010): 498-518.

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