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PRODID:https://www.diw.de/de/diw_01.c.806339.de/veranstaltungen.html
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CALSCALE:GREGORIAN
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UID:diw_01.c.625568.en
LOCATION:Anna J. Schwartz Room,5.2.010,Anton-Wilhelm-Amo-Strasse 58,10117 Berlin
SUMMARY:Optimal Benefit-Based Corporate Income Tax
DESCRIPTION:13:15 - 14:30 // Abstract:   I derive an optimal benefit-based corporate tax rate formula as a function of the public input elasticity of profits and the (net of) tax elasticity of profits. I argue that the existence of the corporate income tax should be justified by the benefit-based view of taxation: firms should pay tax according to the benefits they receive from the use of the public input. I argue that benefit-based corporate taxation is normatively fair. Since the public input is a location-specific factor, a positive benefit-based corporate tax rate is also feasible even in a small open economy. The benefit-based view gives three clear principles of corporate tax design. First, we should tax corporate profits at source. Second, the optimal tax base is location-specific rents. Third, profit shifting is normatively wrong. An empirical application of the formula suggests the optimal benefit-based corporate tax rate on public corporations in the United States lies in the range of 35 to 59 percent.
DTSTART;VALUE=DATE:20200228
DTEND;VALUE=DATE:20200228
DTSTAMP:20200109T230000Z
URL:https://www.diw.de/en/diw_01.c.625568.en/events/optimal_benefit-based_corporate_income_tax.html
ORGANIZER;CN=Peter Haan:mailto:phaan@diw.de
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