Working Paper
Company Tax Reform in Europe and its Effect on Collusive Behavior
Dirk Schindler, Guttorm Schjelderup
CESifo, Munich, 2006
CESifo Working Paper No. 1702
CESifo, Munich, 2006
CESifo Working Paper No. 1702
We study how harmonization of corporate tax systems affects the stability of international cartels. We show that tax base harmonization reinforces collusive agreements, while harmonization of corporate tax rates may destabilize or stabilize cartels. We also find that bilateral and full harmonization to a common standard is worse from society’s point of view than unilateral harmonization to a minimum tax standard.
CESifo Category
Public Finance
Public Finance
Keywords: corporate tax systems, tacit collusion
JEL Classification: H870,L100