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ETPF Research Overview
The central aim of ETPF research is to increase the availability of economic research on issues which are of great importance, not just for multinational companies, but also for tax policy-makers.
The overall plan involves three phases, each of which is expected to last between 12 and 18 months.
5 or 6 commissioned papers are anticipated for each phase. Each of the phases should include a survey of the existing economic literature in that general area. In addition, a paper investigating an issue of policy relevance could be included. Both of these are incorporated into the plans for the first stage, set out below.
The broad themes for each phase are as follows.
1. The effects of international taxation on business
The main aim of phase 1 is to provide evidence of the impact of taxes on the behaviour of corporations, focusing particularly on Europe. This would include, for example, the impact of national and international taxes on where businesses choose to locate their activities and their profit, the scale of their investment, and their financial policy.
Topics
1. The effects of international taxation on the activities of multinational companies: a survey of existing evidence
& data sources
2. How are plant location decisions and capital flows in Europe affected by corporate income taxes?
3. How far do differences in international tax regimes between countries affect financial policies?
4. Profit shifting within the EU: evidence from Germany
5. Do non-profit taxes affect the location of economic activity? Evidence from the EU
6. An economic analysis of ECJ judgements on corporate income taxes in the EU
7. Economic analysis of proposals for a Common Consolidated Corporate Tax Base (CCCTB)
2. The welfare implications of international taxation, and tax competition
Phase 2 focuses more on the impact of businesses - particularly of multinational corporations - on the economic welfare of the countries in which they operate. For example, what are the benefits to individual countries of attracting inward investment? Is there any evidence that governments compete with each to attract mobile capital by reducing their tax rates?
Topics
1. Do higher corporate taxes affect the demand for labour, and hence unemployment?
2. Who bears the burden of corporate income taxes?
3. Why have corporation tax revenues remained so high, when tax rates have fallen so far?
4. Is there any evidence of competition over other forms of tax paid by business?
5. Is foreign direct investment more productive than domestic investment: and are there positive spillovers to domestic firms?
3. International tax design
Phase 3 builds on this positive economic analysis to examine issues in tax policy and design. The main focus will be on broad policy issues, addressing some of the more important policy proposals of the European Commission, and responses to ECJ judgements. However, it would also address wider issues - the aim is not to generate a particular policy position for the ETPF. Rather it is to commission independent academics to provide a rigorous economic examination of important policy issues.
(Specific topics are still taking shape.)
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