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Fiscal Consequences of Corporate Tax Avoidance

Katarzyna Bilicka, Evgeniya Dubinina, Petr Janský and Katarzyna Anna Bilicka
Authors registered in the RePEc Author Service: Katarzyna Anna Bilicka

No 10415, CESifo Working Paper Series from CESifo

Abstract: We study the consequences of multinational tax avoidance on the structure of government tax revenues. To motivate our analysis, we show that countries with high revenue losses due to profit shifting have lower corporate tax revenues and rates and higher indirect tax revenues and rates. To establish causality, we use German municipal data and analyse how changes in municipal trade tax rates levied on corporate profits affect local tax revenue structure. Following a trade tax rate increase, we find that municipalities with high exposure to aggressive multinationals experience a significant decline in trade tax revenue levels and shares.

Keywords: corporate tax avoidance; profit shifting; multinational corporations; government tax revenue structure (search for similar items in EconPapers)
JEL-codes: E62 H26 H71 (search for similar items in EconPapers)
Date: 2023
New Economics Papers: this item is included in nep-acc, nep-mfd, nep-pbe and nep-pub
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https://www.cesifo.org/DocDL/cesifo1_wp10415.pdf (application/pdf)

Related works:
Working Paper: Fiscal Consequences of Corporate Tax Avoidance (2023) Downloads
Working Paper: Fiscal Consequences of Corporate Tax Avoidance (2023) Downloads
Working Paper: Fiscal Consequences of Corporate Tax Avoidance (2023) Downloads
Working Paper: Fiscal consequences of corporate tax avoidance (2022) Downloads
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