Foreign Ownership and Corporate Income Taxation: An Empirical Evaluation

Harry Huizinga and Nicodème, Gaëtan
Authors registered in the RePEc Author Service: Gaetan J.A. Nicodeme

No 3952, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Economic integration in Europe has not led to a ?race to the bottom? regarding corporate income taxes. This Paper documents trends in the foreign ownership of companies in Europe and examines whether foreign ownership has exerted a positive influence on corporate income tax levels. Using company-level data, we document that foreign ownership share in Europe stood at around 21.5% in the year 2000. The estimation suggests that a one percentage point increase in foreign ownership increases the average corporate income tax rate between 0.5-1%. Further international economic integration is likely to lead to higher foreign ownership shares with a concomitant positive influence on corporate taxation levels.

Keywords: Foreign ownership; Corporate taxation; Tax competition (search for similar items in EconPapers)
JEL-codes: F21 H25 (search for similar items in EconPapers)
Date: 2003-06
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Citations: View citations in EconPapers (27)

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Related works:
Journal Article: Foreign ownership and corporate income taxation: An empirical evaluation (2006)
Working Paper: Foreign ownership and corporate income taxation: an empirical evaluation (2003)
Working Paper: Foreign Ownership and Corporate Income Taxation: An Empirical Evaluation (2003)
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