Source versus residence based taxation with international mergers and acquisitions

Arbeitspapier

This paper analyses tax competition and tax coordination in a model where capital flows occur in the form of mergers and acquisitions, rather than greenfield investment. In this framework, we show that differences in residence based taxes do not necessarily distort international ownership patterns. Moreover, tax competition yields globally efficient levels of source based corporate income taxes if residence based taxes on capital income are absent. In contrast, in the presence of residence based taxes on dividends, source based corporate income taxes are inefficiently high. The widespread view that tax coordination is less urgent if residence based taxes are available may therefore be misguided.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 2854

Classification and Topics

• Classification: Wirtschaft ; National Government Expenditures and Related Policies: Infrastructures; Other Public Investment and Capital Stock ; Business Taxes and Subsidies including sales and value-added (VAT) ; Multinational Firms; International Business
• Subject: corporate taxation ; tax competition ; mergers and acquisitions ; Unternehmensbesteuerung ; Ursprungslandprinzip ; Übernahme ; Fusion ; Internationale Kapitalmobilität ; Steuerwettbewerb ; Körperschaftsteuer ; Steuerharmonisierung ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Becker, Johannes ; Fuest, Clemens
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2009

Further information

• Handle: http://hdl.handle.net/10419/30567
• Last update: 10.03.2025, 11:43 AM CET