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Firm-specific forward-looking effective tax rates

  • Peter Egger


  • Simon Loretz


  • Michael Pfaffermayr


  • Hannes Winner


This paper computes (marginal and average) forward-looking effective tax rates for a sample of more than 550,000 firms in and outside of Europe using Bureau van Dijk's ORBIS data-base. Comparing the firm-level effective tax rates with their country-level counterparts we arrive at two important findings for empirical research on the behavioral response to taxation. First, the firm-level component of the effective tax burden is generally much more important than the one at the country level. Second, tentative empirical results on the nexus between firm sales and corporate taxation illustrate that the conclusions obtained with forward looking firm- level effective tax rates differ starkly from those based on country-level forward-looking rates or backward-looking effective tax rates at the firm level.

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Article provided by Springer in its journal International Tax and Public Finance.

Volume (Year): 16 (2009)
Issue (Month): 6 (December)
Pages: 850-870

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Handle: RePEc:kap:itaxpf:v:16:y:2009:i:6:p:850-870
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  1. Büttner, Thiess & Ruf, Martin, 2004. "Tax Incentives and the Location of FDI: Evidence from a Panel of German Multinationals," ZEW Discussion Papers 04-76, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
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