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The code of conduct against harmful tax competition: open method of coordination in disguise?
Author(s) -
Radaelli Claudio M.
Publication year - 2003
Publication title -
public administration
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.313
H-Index - 93
eISSN - 1467-9299
pISSN - 0033-3298
DOI - 10.1111/1467-9299.00359
Subject(s) - benchmarking , convergence (economics) , code (set theory) , competition (biology) , corporate governance , code of conduct , european union , tax competition , public economics , law and economics , public relations , business , political science , computer science , economics , tax reform , international taxation , law , marketing , international trade , management , economic growth , ecology , set (abstract data type) , biology , programming language
The European Union is experimenting with new, non‐binding policy instruments in business taxation, namely a voluntary code of conduct among member states against harmful tax competition. This article raises the question to what extent can the code be considered a manifestation of the open method of coordination (OMC)? Is an open method (based on guidelines, peer review, best practice, benchmarking, learning and diffusion of shared beliefs among policy‐makers) emerging as a new governance architecture in tax policy? If so, what can the code achieve in terms of policy learning and convergence? There are similarities between the code and the open method of coordination – especially with reference to guidelines, peer review, timetables and the identification of ‘worst practice’. However, the political logic of the code does not fit in well with the OMC aims of participatory governance and social learning. In terms of achievements, the code has contributed to the creation of a community of discourse and the diffusion of shared beliefs about what constitutes ‘acceptable’ and ‘harmful’ tax competition. Convergence at the level of discourse, however, should not be confused with convergence of actual tax policies in the member states.