Corporate Tax Policy in the Nordic Countries

Andersson, Krister; Kanniainen, Vesa; Södersten, Jan; Sørensen, Peter Birch

doi:10.1007/978-1-349-13822-7_3

Cited by 15 publications

(9 citation statements)

References 10 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Therefore, the evidence in Table 1 clearly suggests that countries with a positive tax rate differential to adjacent economies are faced with a higher pressure from fiscal competition, which, in turn, increases the likelihood that they will reduce their capital tax rates in subsequent years. These find- Ganghof (2006), providing comprehensive case studies from tax reforms in seven OECD countries (e.g., Australia, Denmark and Finland) over the last twenty years, concludes that tax rate differentials from other countries represented the main motive to cut capital tax rates (see Andersson, et. al., 1998 for similar conclusions on the Nordic countries; Messere, 1998, for evidence from G7 countries; and Bernardi & Profeta, 2004, for detailed case studies on seven EU member states).…”

Section: Fiscal Competitionmentioning

confidence: 99%

Fiscal Competition and the Composition of Public Expenditure: An Empirical Study

Winner¹

2012

Contemporary Economics

View full text Add to dashboard Cite

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. This paper investigates whether fiscal competition affects the structure of public spending, where theory predicts a shift from residential public goods to industrial public goods. We propose an empirical model that specifically accounts for the strategic nature and endogeneity of fiscal competition. Using data for 18 OECD countries and a time period with unprecedented tax competition (1980 to 2000), we find a significant impact of fiscal competition on the composition of public expenditure. This finding is in line with theoretical research, particularly that of Keen and Marchand (1997). Terms of use: Documents in IntroductionFiscal competition forces governments to lower taxes on mobile bases and to provide public goods at inefficiently low levels. This fundamental result of theoretical work on tax competition dates back to Zodrow and Mieszkowski (1986) and Wilson (1986) (see, e.g., Wilson, 1999, Wilson & Wildasin, 2004and Zodrow, 2010 for comprehensive overviews of subsequent contributions). With respect to public goods, Keen and Marchand (1997)

show abstract

Section: Fiscal Competitionmentioning

confidence: 99%

Fiscal Competition and the Composition of Public Expenditure: An Empirical Study

Winner¹

2012

Contemporary Economics

View full text Add to dashboard Cite

show abstract

“…19-20). 47 The M-I regimes share a common feature with the investment reserves and the tax allocation reserves used in many OECD countries -especially in the Nordic countries and especially until the early 1990's -to promote investment or as a countercyclical tool (see, among others, Andersson et al (1998) and Kari et al (2019)). Indeed, as for both the types of reserves, under both the M-I regimes the tax benefits are related to retained profits.…”

Section: The Tax Benefits To Retained Earnings: the Mini-ires Regimesmentioning

confidence: 99%

An Economic Assessment of the Evolution of the Corporate Tax System in Italy

Zangari

2020

SSRN Journal

View full text Add to dashboard Cite

This paper provides an assessment of the evolution of the Italian corporate tax system over the last decade through the computations of new and updated effective tax rates. The analysis takes into account the specificities of Italy's Allowance for Corporate Equity (ACE) and looks at the evolution of market interest rates to evaluate the effects. It relies on a new method to measure the effect of the limits to the deductibility of the cost of debt. Over the period 2010-2020, the legislative changes led to effective taxation becoming highly volatile. This dynamic was mostly driven by the evolution of the ACE regime. Since 2016, the temporary tax incentives for purchasing machinery greatly reduced the cost of capital. However, since 2019 the provision that phased out the incentives at higher-levels of investment may have lowered their effectiveness for larger firms. The analysis also shows that ACE has better economic properties than the Mini-Ires regime that replaced it temporarily in 2019, in terms of incentive to invest and to increase equity funding.

show abstract

“…Income from the point of view of economists is referred to an individual consumer and is typically defined as the maximum which can be consumed by an individual in a determined period without impairing her wealth or capital (Hicks, 1946; see also Fetter, 1937). From the point of view of accountants income is also called profit or earnings, and is referred to the increase in a firm's assets after distributions of dividends to shareholders (Canning, 1 Under the Allowance-for-Corporate-Equity system (also known as the imputed income method), only excess profits are taxed, whereas normal returns to capital are exempt from corporate income taxes (Boadway and Bruce, 1984;Rose and Wiswesser, 1998;Andersson et al, 1998. See also Sørensen, 1994Sørensen, , 1998 on the Dual Income Tax).…”

Section: Residual Income and Its Basic Constituentsmentioning

confidence: 99%

Splitting up value: A critical review of residual income theories

Magni

2009

European Journal of Operational Research

View full text Add to dashboard Cite

This paper deals with the notion of residual income, which may be defined as the surplus profit that residues after a capital charge (opportunity cost) has been covered. While the origins of the notion trace back to the 19th century, in-depth theoretical investigations and widespread real-life applications are relatively recent and concern an interdisciplinary field connecting management accounting, corporate finance and financial mathematics (Peasnell, 1981(Peasnell, , 1982Peccati, 1987Peccati, , 1989Peccati, , 1991Stewart, 1991;Ohlson, 1995; Arnold and Davies, 2000;Young and O'Byrne, 2001;Martin, Petty and Rich, 2003). This paper presents both a historical outline of its birth and development and an overview of the main recent contributions regarding capital budgeting decisions, production and sales decisions, implementation of optimal portfolios, forecasts of asset prices and calculation of intrinsic values. A most recent theory, the systemic-value-added approach (also named lost-capital paradigm), provides a different definition of residual income, consistent with arbitrage theory. Enfolded in Keynes's (1936) notion of user cost and forerun by Pressacco and Stucchi (1997), the theory has been formally introduced in Magni (2000a,b,c;2001a,b;, where its properties are thoroughly investigated as well as its relations with the standard theory; two different lost-capital metrics have been considered, for value-based management purposes, by Drukarczyk and Schueler (2000) and Young and O'Byrne (2001). This work illustrates the main properties of the two theories and their relations, and provides a minimal guide to construction of performance metrics in the two approaches. Running title. A Critical Review of Residual Income TheoriesScientific areas. Corporate finance, management accounting, financial mathematics.

show abstract

Corporate Tax Policy in the Nordic Countries

Cited by 15 publications

References 10 publications

Fiscal Competition and the Composition of Public Expenditure: An Empirical Study

Fiscal Competition and the Composition of Public Expenditure: An Empirical Study

An Economic Assessment of the Evolution of the Corporate Tax System in Italy

Splitting up value: A critical review of residual income theories

Contact Info

Product

Resources

About