Competition and Co-ordination in International Capital Income Taxation

Stefan Homburg

FinanzArchiv: Public Finance Analysis, 1999, vol. 56, issue 1, 1-17

Abstract: The paper analyses gains from international tax co-ordination. Focussing on capital income taxes in a two country model, the main result is that gains from co-ordination, or from tax harmonisation, are by far smaller than is normally assumed if the countries tax capital income according to the residence principle. In particular, we show that equilibria under this tax regime are constrained Pareto-optimal so that there are never gains for both countries. With residence taxation, tax rate harmonisation accompanied by inter-governmental transfers only redistribute income from the low tax country to the high tax country. This pictures changes, however, when the capital exporting country applies the source principle instead of the residence principle.

Date: 1999
References: Add references at CitEc
Citations: View citations in EconPapers (22)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

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:mhr:finarc:urn:sici:0015-2218(199903)56:1_1:caciic_2.0.tx_2-9

Ordering information: This journal article can be ordered from
Mohr Siebeck GmbH & Co. KG, P.O.Box 2040, 72010 Tübingen, Germany

Access Statistics for this article

FinanzArchiv: Public Finance Analysis is currently edited by Alfons Weichenrieder, Ronnie Schöb and Jean-François Tremblay

More articles in FinanzArchiv: Public Finance Analysis from Mohr Siebeck, Tübingen
Bibliographic data for series maintained by Thomas Wolpert ().