TAX HARMONIZATION VERSUS FISCAL COMPETITION

Florin Alexandru Macsim () and Florin Oprea ()
Additional contact information
Florin Alexandru Macsim: „Alexandru Ioan Cuza” University of Ia?i, Romania
Florin Oprea: Alexandru Ioan Cuza” University of Ia?i, Romania

The USV Annals of Economics and Public Administration, 2016, vol. 16, issue 2(24), 145-155

Abstract: Recent years have brought into discussion once again subjects like tax harmonization and fiscal competition. Every time the European Union tends to take a step forward critics enter the scene and give contrary arguments to European integration. Through this article we have offered our readers a compelling view over the “battle” between tax harmonization and fiscal competition. While tax harmonization has key advantages as less costs regarding public revenues, leads to higher degree of integration and allows the usage of fiscal transfers between regions, fiscal competition is no less and presents key advantages as high reductions in tax rates and opens a large path for new investments, especially FDI. Choosing tax harmonization or fiscal competition depends on a multitude of variables, of circumstances, the decision of choosing one path or the other being ultimately influenced by the view of central and local authorities. Our analysis indicates that if we refer to a group of countries that are a part of a monetary union or that form a federation, tax harmonization seems to be the best path to choose. Moving the analysis to a group of regions that aren’t taking any kind of correlated actions or that have not signed any major treaties regarding monetary or fiscal policies, the optimal solution is fiscal competition.

Date: 2016
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.seap.usv.ro/annals/arhiva/USVAEPA_VOL.1 ... 4),2016_fulltext.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:scm:usvaep:v:16:y:2016:i:2(24):p:145-155

Access Statistics for this article

The USV Annals of Economics and Public Administration is currently edited by Editura Universitatii Stefan cel Mare din Suceava

More articles in The USV Annals of Economics and Public Administration from Stefan cel Mare University of Suceava, Romania, Faculty of Economics and Public Administration Contact information at EDIRC.
Bibliographic data for series maintained by Liviu Scutariu ().