Do Higher Corporate Taxes Reduce Wages? Micro Evidence from Germany

Clemens Fuest, Andreas Peichl and Sebastian Siegloch

No 4247, CESifo Working Paper Series from CESifo

Abstract: This paper estimates the incidence of corporate taxes on wages using a 20-year panel of German municipalities exploiting 6,800 tax changes for identification. Using event study designs and differences-in-differences models, we find that workers bear about half of the total tax burden. Administrative linked employer-employee data allow us to estimate heterogeneous firm and worker effects. Our findings highlight the importance of labor market institutions and profit-shifting opportunities for the incidence of corporate taxes on wages. Moreover, we show that low-skilled, young and female employees bear a larger share of the tax burden. This has important distributive implications.

Keywords: business taxation; wage incidence; administrative data; local taxation (search for similar items in EconPapers)
JEL-codes: H20 H70 J30 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (37)

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Related works:
Journal Article: Do Higher Corporate Taxes Reduce Wages? Micro Evidence from Germany (2018)
Working Paper: Do Higher Corporate Taxes Reduce Wages? Micro Evidence from Germany (2017)
Working Paper: Do higher corporate taxes reduce wages? Micro evidence from Germany (2016)
Working Paper: Do Higher Corporate Taxes Reduce Wages? Micro Evidence from Germany (2013)
Working Paper: Do higher corporate taxes reduce wages? Micro evidence from Germany (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_4247

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