Tax factors affecting FDI allocation in the EU post-socialist states
Jana Tepperová and
Post-Communist Economies, 2021, vol. 33, issue 6, 710-725
The aim of the paper is to reveal the parameters of tax systems – in both the investor and the recipient state – that influence FDI allocation in post-socialist EU countries and cross-border flows of selected types of payments. Our results confirm that investors from EU countries strive to take advantage of both tax rate differences and aggressive tax planning strategies. Regression model estimates show that the investor’s national tax system is of key importance if it allows for the non-taxation of interest income, application of lower rates to royalties and use of special purpose entities. Moreover, the size of FDI is relatively strongly linked to the amount of payments for advisory services and royalties which are often used for aggressive tax planning. The estimated elasticity of FDI to the tax rate is around 1.1 and 1.9 for statutory and effective rates, respectively.
References: Add references at CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
Access to full text is restricted to subscribers.
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:taf:pocoec:v:33:y:2021:i:6:p:710-725
Ordering information: This journal article can be ordered from
Access Statistics for this article
Post-Communist Economies is currently edited by Roger Clarke
More articles in Post-Communist Economies from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().