The economics of corporate and business tax reform

Dharmapala, Dhammika (2016) The economics of corporate and business tax reform. Centre for Business Taxation Working Paper, Oxford.

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Abstract

The reform of corporate and business taxation is central to current tax policy debates in the United States. This paper provides a framework for analyzing reform proposals by describing the lessons
from current economic research for business tax reform, addressing both international and domestic reforms within a unified perspective. The paper begins by identifying ten potential
inefficiencies created by the current corporate tax regime. It then discusses three classes of reform proposals. The first involves a substantially lower corporate tax rate and a territorial regime. The
second is a formula apportionment system. The third category includes a destination-based cash flow tax. The paper evaluates each of these proposals in the light of the framework introduced
earlier. It concludes that the relatively modest reforms currently under discussion would address only a few of these margins. In contrast, more fundamental reforms would eliminate all or most of
the inefficiencies of corporate taxation.

Item Type: Other Working Paper
Keywords: Oxford University Centre for Business Taxation, Corporate tax; Business taxation; International taxation; Tax reform; Territorial taxation; Formula apportionment; Cash flow tax
Subject(s): Taxation
Centre: Oxford University Centre for Business Taxation > CBT Working Papers
Date Deposited: 08 Feb 2019 12:49
Last Modified: 08 Feb 2019 12:49
Funders: Lee and Brena Freeman Faculty Research Fund at the University of Chicago Law School
URI: http://eureka.sbs.ox.ac.uk/id/eprint/7300

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