Economics at your fingertips  

Club convergence in the corporate income tax: The case of European effective rates

Francisco J. Delgado, Fernández-Rodríguez, Elena, Martínez-Arias, Antonio and Maria J. Presno

Physica A: Statistical Mechanics and its Applications, 2019, vol. 523, issue C, 942-953

Abstract: The corporate income tax is permanently under debate in recent decades with respect to coordination and competition issues, including the race-to-the-bottom hypothesis, and the effects on investment and economic growth of such a distortionary tax. In this paper we study the evolution of the effective corporate tax rates in the European Union through a convergence analysis, identifying common trends by a club convergence approach. The results evidence three clubs, with the high-tax-rate-club formed by France, Malta, Spain and Portugal. In addition, and compared with the results for the statutory corporate tax rates, important differences arise, showing the significance of the fiscal benefits in this tax and the distance between both tax rates in many European countries. Our results are also analysed in the fiscal harmonization framework.

Keywords: Club convergence; Effective tax rates; Corporate income tax; European Union (search for similar items in EconPapers)
JEL-codes: C33 E62 H20 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
Full text for ScienceDirect subscribers only. Journal offers the option of making the article available online on Science direct for a fee of $3,000

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:

Access Statistics for this article

Physica A: Statistical Mechanics and its Applications is currently edited by K. A. Dawson, J. O. Indekeu, H.E. Stanley and C. Tsallis

More articles in Physica A: Statistical Mechanics and its Applications from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

Page updated 2019-08-24
Handle: RePEc:eee:phsmap:v:523:y:2019:i:c:p:942-953