The issue of harmonizing tax incentives in the various regional economic groupings that exist in the Latin America and Caribbean region has recently again come under discussion. My aim in this paper is essentially to sketch a framework within which countries contemplating this issue may approach...

This paper discusses what the growth of e-commerce means for tax policy and administration, both within countries and between them. Although the fiscal implications of such commerce as yet remain limited, the future may be different and the issues are important. The issues are first discussed...

As well known, companies shift income from high to low tax jurisdictions. Typically, profit shifting is achieved by “direct” financing structures whereby companies use debt finance in the high tax entity and equity finance in the low tax entity. However, certain tax policies can lead to...

Subnational governments are faced with increased pressure to initiate policies to further local economic development. This paper traces the changes in the theory and practice of local development initiatives in North America. The paper uses Ontario and its municipal sector as a case study of the...

An empirical model is developed to estimate the probability of a given tax status based on firm characteristics. A structural switching regression model of the firm’s demand for capital goods is next specified and incorporates expressions for the user cost of capital which account for tax...

Over a decade ago, several Canadian provinces replaced their retail sales taxes by value-added taxes. This paper estimates the effects of this tax substitution on business investment in the reforming provinces. Consistent with theory, we find that the reform led to significant increases in...

This paper analyzes the interaction between corporate taxes and corporate governance. We show that the characteristics of a taxation system affect the extraction of private benefits by company insiders. A higher tax rate increases the amount of income insiders divert and thus worsens governance...

The paper summarizes the main weaknesses of Jordan’s current incentive program. Because of these weaknesses, Jordan’s long history of investment incentives has proven not to attract significant capital investment in areas favored by government. Instead, these measures have simply eroded the...

The value-added tax has, in recent decades, become the most important single tax in most developing and transitional economies. This paper reviews some problems that have emerged as important as more experience has been gained with how VATs really work in many such countries and suggests some...

The federal government is reducing its GST rate from 7% to 5%. We examine a broader reform in which this reduction in federal tax rates and revenues is accompanied by a similar reduction in federal transfers to the provinces. At the same time, the provinces may if they wish increase their own...