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Title:Optimal tax policy when firms are internationally mobile PDF Logo
Authors:Becker, Johannes
Fuest, Clemens
Issue Date:2005
Series/Report no.:CESifo working papers 1592
Abstract:The standard tax theory result that investment should not be distorted is based on the assumption that profits are locally bound. In this paper we analyze the optimal tax policy when firms are internationally mobile. We show that the optimal policy response to increasing firm mobility may be taxation, subsidization or non-distortion of investment depending on whether the mobile firms are more or less profitable than the average firm in the economy. Our findings may contribute to understanding recent tax policy developments in many OECD countries.
Subjects:corporate taxes
optimal tax policy
JEL:H21
H25
Document Type:Working Paper
Appears in Collections:CESifo Working Papers, CESifo Group Munich

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