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Corporate Income Taxation in Canada

Author

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  • George R. Zodrow

    () (Rice University, Oxford University Centre for Business Taxation)

Abstract

This paper examines Canadian corporate income tax policy, focusing on the implications of international capital mobility, international tax competition – including the need for a corporate tax structure that is competitive with respect to the United States and other competing economies – and international tax avoidance. The paper begins by considering the arguments for tax exemption or even subsidization of capital income, and then examines the many qualifications to these arguments. This analysis pays particular attention to the implications of the existence of firm-specific and location-specific economic rents and the issues raised by new techniques for international tax avoidance. In all cases, the discussion of theoretical arguments is followed by an examination of the empirical evidence, including studies specific to Canada as available. The paper then traces out the implications of the analysis for corporate income tax policy in Canada, including the recently enacted corporate income tax rate reductions and other potential reforms.

Suggested Citation

  • George R. Zodrow, 2008. "Corporate Income Taxation in Canada," Working Papers 0819, Oxford University Centre for Business Taxation.
  • Handle: RePEc:btx:wpaper:0819
    as

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    File URL: http://www.sbs.ox.ac.uk/sites/default/files/Business_Taxation/Docs/Publications/Working_Papers/Series_08/WP0819.pdf
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    References listed on IDEAS

    as
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    Citations

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    Cited by:

    1. Don Fullerton & Gilbert Metcalf, 2002. "The Distribution of Tax Burdens," Discussion Papers Series, Department of Economics, Tufts University 0201, Department of Economics, Tufts University.
    2. Zodrow, George R., 2010. "Capital Mobility and Capital Tax Competition," National Tax Journal, National Tax Association, vol. 63(4), pages 865-901, December.
    3. Kelly Edmiston & F. Javier Arze del Granado, 2004. "Economic effects of apportionment formula changes : results from a panel of corporate income tax returns," Community Affairs Research Working Paper 2005-03, Federal Reserve Bank of Kansas City.

    More about this item

    Keywords

    Canadian corporate income tax; business tax reform; international tax competition; international tax avoidance; international capital mobility;

    JEL classification:

    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies

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