Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/39644 
Year of Publication: 
2005
Series/Report no.: 
ZEI Working Paper No. B 09-2005
Publisher: 
Rheinische Friedrich-Wilhelms-Universität Bonn, Zentrum für Europäische Integrationsforschung (ZEI), Bonn
Abstract: 
This paper calculates effective macro-economic tax rates for the 25 EU countries following the methodology developed in Mendoza, Razin, and Tesar (1994). The available Eurostat data allow to compute the tax wedge on consumption, labor and capital. We show that effective tax rates in the 10 new member states of the EU are on average 10 percentage points lower on labor, and 5 percentage points lower on capital and consumption. There is no tendency of convergence in effective tax burdens on capital. The newly computed tax rates are in line with the effective tax rates of the EU Commission for EU 15. Effective tax rates on capital are only weakly connected to statutory tax rates on corporate income. As they are calculated from macroeconomic data they provide only limited information on the actual tax burdens of individual corporations or households.
Subjects: 
Effective tax
Europe
JEL: 
H20
E62
H24
H25
Document Type: 
Working Paper

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