Collecting the Tax Deficit of Multinational Companies: Simulations for the EU

Mona Barake (), Paul-Emmanuel Chouc (), Theresa Neef () and Gabriel Zucman ()
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Mona Barake: EU Tax Observatory
Paul-Emmanuel Chouc: EU Tax Observatory
Theresa Neef: EU Tax Observatory
Gabriel Zucman: EU Tax Observatory

No 1, Reports from EU Tax Observatory

Abstract: This report estimates the amount of tax revenue that the EU could raise by imposing a minimum tax on the profits of multinational companies. The study considers several scenarios for the imposition of such a tax — ranging from an international tax agreement to unilateral measures — and a range of rates. An international agreement on a minimum rate of 25% would allow the European Union to increase its tax revenues by 170 billion in 2021, an increase of 50% of the corporate tax revenue collected today. With a minimum rate of 15%, the additional tax revenue would only amount to about 50 billion euros. An EU country that unilaterally chose to subject its multinationals to a minimum rate of 25% and taxed part of the tax deficit of non-resident companies accessing its market would increase its corporate tax revenues by around 70%.

Keywords: minimum corporate tax; multinational companies; effective tax rate; tax avoidance; corporate tax revenue; tax deficit; EU tax policy (search for similar items in EconPapers)
JEL-codes: F23 H25 H87 (search for similar items in EconPapers)
Pages: 60 pages
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:dbp:report:001

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