Devereux, Michael and Loretz, Simon (2007) The Effects of EU Formula apportionment on Corporate Tax Revenues. Centre for Business Taxation WP 07/06.
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The European Commission proposes to replace the current system of taxing corporate income of separate accounting by a two-step 'consolidate and apportionment' procedure. This paper uses a large set of unconsolidated firm-level data to assess the likely impact on corporate tax revenues in each Member State. Taking pre-tax profit as given, overall tax revenues would be likely to drop by 2.5% if companies can choose whether to participate. By contrast, if they were forced to participate, total tax revenues would be likely to increase by more than 2%, leaving some European countries, and most notably Spain, Sweden and the United Kingdom better off. We investigate how sensitive these results are to the apportionment factors used.
|Item Type:||Other Working Paper|
|Keywords:||Corporate Taxation; International Loss Consolidation; Apportionment Rules|
|Centre:||Oxford University Centre for Business Taxation > CBT Working Papers|
|Date Deposited:||24 May 2012 14:28|
|Last Modified:||15 Oct 2015 02:18|
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