 Systems of Corporate Income TaxationIkonomiceski i Sotsialni Alternativi, 2019, issue 1, 60-72 Abstract: Within the context of growing capital mobility, taxation of corporate profits is becoming a daunting challenge to most governments. The predominating in the world classical system considers the corporation as an independent legal entity, whose property and liabilities are separate from those of the owners. The double taxation, however, increases the tax burden on entrepreneurs and distorts the choices of financing methods of companies. In addition, the differential tax treatment of dividends and interests paid distorts firms’ investment decisions. With a view of overcoming the problems inherent in the classical system, a number of countries have adopted alternative tax regimes based on the integration of corporate and individual income taxes. The present article provides a concise review of the existing systems of corporate income tax and a comparison of their advantages and shortcomings. The main conclusion is that the classical system remains most widely used, albeit in a modified version, and it is the most appropriate regime in terms of achieving neutrality between resident and non-resident investors. Keywords: corporate income tax; classical system; integration of corporate and individual income tax (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:nwe:iisabg:y:2019:i:1:p:60-72 Access Statistics for this article More articles in Ikonomiceski i Sotsialni Alternativi from University of National and World Economy, Sofia, Bulgaria Contact information at EDIRC. |
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