EconPapers    
Economics at your fingertips  
 

What Happened to CIT collection? Solving the Rates-Revenues Puzzle

Antonella Caiumi, Ina Majewski and Gaëtan Nicodème ()

No 13385, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Despite sharp reductions in corporate income tax (CIT) rates worldwide, CIT revenues have not fallen dramatically in the last two decades. This paper investigates the recent developments in CIT in the European Union, by taking a closer look at the potential driving forces behind this puzzle. Using a unique dataset of national sectoral accounts, we decompose the CIT revenue to GDP ratio for the EU and find that while the decrease in the statutory rates has driven down tax collection, the effect was more than offset by a broadening of the taxable base and a slight increase in the size of the corporate sector. However, this result holds for the period 1995-2015 but not for the last decade where base broadening has not been able to match further cuts in rates.

Keywords: corporate tax; European Union; Implicit Tax Rate; Incorporation; Tax Reforms (search for similar items in EconPapers)
JEL-codes: E62 H25 O52 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-acc, nep-eec, nep-mac, nep-pbe and nep-pub
Date: 2018-12
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.cepr.org/active/publications/discussion_papers/dp.php?dpno=13385 (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

Related works:
Working Paper: What Happened to CIT Collection? Solving the Rates-Revenues Puzzle (2018) Downloads
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:cpr:ceprdp:13385

Ordering information: This working paper can be ordered from
http://www.cepr.org/ ... rs/dp.php?dpno=13385

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().

 
Page updated 2019-11-12
Handle: RePEc:cpr:ceprdp:13385