Corporate Tax Competition Between Firms

Loretz, Simon and Moore, Padraig (2009) Corporate Tax Competition Between Firms. Centre for Business Taxation WP 09/12.

[img]
Preview
PDF
Download (394kB) | Preview

Abstract

Firms' tax planning decisions, similar to their other operational decisions, are made in a competitive environment. Various stakeholders observe the tax payments and evaluate these against the relevant peer group, which creates interdependencies in the tax planning activities of firms. Introducing the concept of reputational loss we show the positive interdependence in a theoretical model and test it in a spatial econometric model. Empirical evidence suggests that benchmarking takes place both within countries and within industries, however for the latter it is important to include firms in large non-EU OECD countries. Further, the analysis shows that spatial interdependence is stronger for the largest firms and if they have an average effective tax rate above the statutory tax rate

Item Type: Other Working Paper
Keywords: Corporate Taxation; Benchmarking; Tax Competition; Spatial Econometrics
Centre: Oxford University Centre for Business Taxation > CBT Working Papers
Date Deposited: 23 May 2012 15:48
Last Modified: 15 Oct 2015 02:18
URI: http://eureka.sbs.ox.ac.uk/id/eprint/3298

View statistics

Actions (login required)

Edit View Edit View