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CCCTB 4 EU? SA vs. FA w/ FTA
Author(s)
Date Issued
2012-10
Date Available
2012-10-16T16:24:55Z
Abstract
Since its conception, some within the European Union have expressed concerns over
the ability of multinationals to avoid taxation by undertaking transfer pricing to shift profits
towards low tax locations. These concerns have been growing, leading to a renewed call for a common consolidated corporate tax base wherein profits are allocated to nations according to a formula rather than firms’ internal prices. This paper analyzes the merits of such a shift in taxation. In particular, it is shown that, given tax rates, implementing formula apportionment can result in greater tax revenues and less intense tax competition particularly for lower trade barriers. However, this is not always the case and depends on parameter values, including those describing the extent of economic integration.
Sponsorship
Not applicable
Type of Material
Working Paper
Publisher
University College Dublin. School of Economics
Series
UCD Centre for Economic Research Working Paper Series
WP12/24
Subject – LCSH
Corporations--Taxation--European Union countries
Investments, Foreign--European Union countries
Apportionment
Web versions
Language
English
Status of Item
Not peer reviewed
This item is made available under a Creative Commons License
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