Open AccessSteuerwettbewerb ein Ende setzen
Author(s) -
Nicola Liebert
Publication year - 2009
Publication title -
prokla
Language(s) - English
Resource type - Journals
eISSN - 2700-0311
pISSN - 0342-8176
DOI - 10.32387/prokla.v39i154.442
Subject(s) - tax competition , business , multinational corporation , tax avoidance , profit (economics) , indirect tax , tax reform , corporate tax , economics , ad valorem tax , value added tax , international economics , market economy , economic policy , labour economics , public economics , finance , microeconomics
The global mobility of capital and the availability of tax havens enable multinational corporations and wealthy individuals to escape tax payments due in their home countries. Most states react by shifting more of the tax burden onto labour and consumption, while lowering corporate tax rates in an effort to remain internationally competitive, thereby creating a tax system that is both inequitable and socially and economically unsustainable. However, there is scant evidence that lower taxes on capital in fact contribute to higher investment, but they do lead to profit shifting for the purpose of tax planning. Alternative tax systems such as unitary taxation could help to stop profit shifting and slow down tax competition.