The paper analyses the financial structure of German inward FDI. From a tax perspective, intra-company loans granted by the parent should be all the more strongly preferred over equity the lower the tax rate of the parent and the higher the tax rate of the German affiliate. From our study of a...

We use a unique exogenous corporate tax policy change in the Republic of Ireland to investigate how corporate taxation affects foreign direct investment at the extensive and intensive margin. To this end we construct exhaustive sectoral and plant level panel data and use...

This paper argues that the large reduction in corporate tax rates and only gradual widening of tax bases in many countries over the last decades are consistent with tougher international competition for foreign direct investment (FDI). To make this point we develop a model in which governments...

We investigate whether government subsidies to local input manufacturers encourage procurement from foreign firms. We use a comprehensive panel data of Irish firms from 1983 until 2002. Our data shows a spontaneity about linkages and relative insensitivity to grant aid, although it may be the...

Tax expenditures are granted for a variety of purposes in Germany. The paper presents data on the extent and the structure of the tax expenditures in the period 2005 to 2012. Tax expenditures will be reduced somewhat in the period 2005–2012. They should be cut further in order to increase...

Subsidization policy is intensively discussed in Germany. The paper demonstrates the extent of subsidization in Germany. Subsidies are defined as the sum of tax expenditures and those government expenditures which distort the structure of the economy; financial aid is granted to different...

Tax expenditures are granted for a variety of purposes in Germany. They were significantly reduced in December 2003. After the general election in 2005, additional reductions of the tax expenditures were decided upon; however, new measures were introduced, too. The paper presents data on the...

The paper presents data on the taxation of business income in the Federal Republic of Germany in the nineties. The government's plan to reform the system of taxing corporate and personal income is portrayed and assessed. It turns out that the reform proposal has numerous disadvantages; it is...

It is often proposed that capital income tax rates be harmonized. Otherwise, a “race to the bottom” will occur and lead to governments not being able to perform their usual tasks. However, the development of corporate income tax revenues in relation to GDP does not indicate that a race to...

The paper includes data on the taxation of wage income (labor income tax and contributions to social security) and capital income in the Federal Republic of Germany. Average tax rates and marginal tax rates for typical wage income earners are shown for the 1977–1999 period; average tax rates...