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Dwenger, Nadja
Year of Publication: 
Series/Report no.: 
DIW Discussion Papers 764
In Germany, the tax loss carry-forward of corporations significantly increased over the last decade. At the same time only a small percentage of losses have been effectively offset in the following periods. One potential reason for this puzzle is that stricter loss offset restrictions have been introduced in recent years. I use a newly developed micro simulation model for the corporate sector in Germany to evaluate the fiscal effects of these restrictions. Additionally, distributional breakdowns concerning the amounts of tax loss carry-forward and the effects of loss offset restrictions are provided. I find that the restrictions on the use of tax loss carryback are rather ineffective while the newly introduced minimum taxation considerably increases yearly tax revenue by 1.1 billion €.
micro simulation
loss offset restrictions
corporate taxation
tax loss carryforward
tax loss carry-back
tax reform
Document Type: 
Working Paper

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