EconPapers    
Economics at your fingertips  
 

Tax Competition Between Sub-Central Governments

Hansjörg Blöchliger and José Maria Pinero Campos
Additional contact information
José Maria Pinero Campos: OECD

No 13, OECD Working Papers on Fiscal Federalism from OECD Publishing

Abstract: Tax competition is the strategic interaction of tax policy between sub-central governments (SCG) with the objective to attract and retain mobile tax bases. Tax competition rests on firms’ and households’ willingness and ability to shift the tax base – i.e. profits, capital, income, consumption etc. – after SCG tax policy changes. There is no tax competition without tax base mobility. The views on the benefits and costs of tax competition differ widely: while some consider that tax competition brings sub-central fiscal policy closer to citizen’s preferences, increases the efficiency of the public sector and avoids tax and spending excesses, others argue that tax competition leads to a distorted tax structure, to growing tax rate disparities and to an under-provision of publicly provided services. The degree of tax competition is likely to vary across countries and over time and is strongly shaped by the fiscal and institutional framework. Tax competition is not only an issue for federal countries, but also for unitary countries where local governments often have far-reaching tax autonomy.

Date: 2011-04-19
References: Add references at CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed

Downloads: (external link)
https://doi.org/10.1787/5k97b1120t6b-en (text/html)

Related works:
Working Paper: Tax Competition Between Sub-Central Governments (2011) 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:oec:ctpaab:13-en

Access Statistics for this paper

More papers in OECD Working Papers on Fiscal Federalism from OECD Publishing Contact information at EDIRC.
Bibliographic data for series maintained by ().

 
Page updated 2020-07-06
Handle: RePEc:oec:ctpaab:13-en