Explaining European Patterns of Taxation: From the Introduction of the Euro to the Euro-Crisis
AbstractThis paper reviews developments in Europe from the eve of the introduction of the euro through the euro crisis. The paper begins with a discussion of the tax reform agenda. Although there are differences in the literature on specific taxes, and while European countries vary in their preferred levels of taxation, there is general consensus on the shape reforms should take. The paper then discusses the evolution of tax systems with the overall agenda in mind. It is found that overall revenue levels were broadly stable until just before the crisis, but marginal rates in corporate and top personal income declined almost continuously. During the crisis, however, this trend ended, with countries in the greatest fiscal difficulties raising tax rates and tax burdens. The last section provides a short analysis of why there were reforms in some countries but not others. Key variables include tax competition among member states, partisanship, underlying preferences in the population for redistribution, and the number of partisan veto players.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Inter-American Development Bank, Research Department in its series Research Department Publications with number 4777.
Date of creation: May 2012
Date of revision:
Find related papers by JEL classification:
- H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
- H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
This paper has been announced in the following NEP Reports:
- NEP-ACC-2012-07-14 (Accounting & Auditing)
- NEP-ALL-2012-07-14 (All new papers)
- NEP-EEC-2012-07-14 (European Economics)
- NEP-PBE-2012-07-14 (Public Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Sinn, Hans-Werner, 1990.
"Tax harmonization and tax competition in Europe,"
Munich Reprints in Economics
19846, University of Munich, Department of Economics.
- Michael Keen & Alexander Klemm & Victoria Perry, 2010. "Tax and the Crisis," Fiscal Studies, Institute for Fiscal Studies, vol. 31(1), pages 43-79, 03.
- Devereux, Michael P. & Lockwood, Ben & Redoano, Michela, 2008.
"Do countries compete over corporate tax rates?,"
Journal of Public Economics,
Elsevier, vol. 92(5-6), pages 1210-1235, June.
- Devereux, Michael P & Lockwood, Ben & Redoano, Michela, 2002. "Do Countries Compete over Corporate Tax Rates?," CEPR Discussion Papers 3400, C.E.P.R. Discussion Papers.
- Devereux, Michael P & Lockwood, Ben & Redoano, Michela, 2002. "Do Countries Compete Over Corporate Tax Rates?," The Warwick Economics Research Paper Series (TWERPS) 642, University of Warwick, Department of Economics.
- Heinemann, Friedrich & Overesch, Michael & Rincke, Johannes, 2008.
"Rate Cutting Tax Reforms and Corporate Tax Competition in Europe,"
ZEW Discussion Papers
08-028, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Friedrich Heinemann & Michael Overesch & Johannes Rincke, 2010. "Rate-Cutting Tax Reforms And Corporate Tax Competition In Europe," Economics and Politics, Wiley Blackwell, vol. 22(3), pages 498-518, November.
- European Commission, 2011. "Taxation trends in the European Union: 2011 edition," Taxation trends 2011, Directorate General Taxation and Customs Union, European Commission.
- Luigi, Bernardi, 2011. "Economic crisis and taxation in Europe," MPRA Paper 31007, University Library of Munich, Germany.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Monica Bazan).
If references are entirely missing, you can add them using this form.