Tax Harmonisation in Europe: The Determination of Corporate Taxable Income in the EU Member States

Andreas Oestreicher and Christoph Spengel

No 07-035, ZEW Discussion Papers from ZEW - Leibniz Centre for European Economic Research

Abstract: The aim of this paper is twofold. First, we want to examine whether and if so, to what extent, the concept of International Financial Reporting Standards (IFRS) meets the requirements of a Common Consolidated Corporate Tax Base (CCCTB) for the EU-wide activities of multinationals as proposed by the European Commission. Second, we estimate the consequences on the effective levels of company tax burdens in selected EU member states if IFRS are considered as a tool for defining the tax base. Our analysis reveals that IFRS could provide elements of a common and harmonised European tax base in certain areas. In particular, tax accounting still has to follow the realisation principle. Therefore, IFRS ?fair value-accounting? cannot be adopted for tax purposes. A transition to tax accounting on the basis of IFRS has only minor effects on the effective tax burdens of companies.

Keywords: International Company Taxation; Effective Tax Burden; Tax Accounting (search for similar items in EconPapers)
JEL-codes: H21 H25 (search for similar items in EconPapers)
Date: 2007
New Economics Papers: this item is included in nep-acc, nep-eec, nep-pbe and nep-pub
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Citations: View citations in EconPapers (14)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:zewdip:5694

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