Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/125566 
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Title: 

Cross-border or online: Tax competition with mobile consumers under destination and origin principle

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Authors: 
Year of Publication: 
2015
Series/Report no.: 
cege Discussion Papers No. 265
Publisher: 
University of Göttingen, Center for European, Governance and Economic Development Research (cege), Göttingen
Abstract: 
This paper studies the effect of an online retailer on spatial tax competition with mobile consumers. If taxation for online purchases follows the destination principle, the entry of the online retailer mitigates tax competition; if taxation for online purchases follows the origin principle, the entry of the online retailer enhances tax competition. Lower cost of online shopping enhances the effect of the online retailer on tax competition, limited internet access decreases the effect of the online retailer on tax competition. For sufficiently low cost of online shopping, welfare in the country where the online retailer is located is higher under the origin principle and welfare in the other country is higher under the destination principle. Total welfare is higher under the destination principle.
Subjects: 
tax competition
cross-border shopping
online retailer
destination principle
origin principle
JEL: 
F12
H20
L13
Document Type: 
Working Paper

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The document was removed on behalf of the author(s)/ the editor(s) on: March 21, 2019


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