There is a growing literature on commodity tax competition among countries in the European Union (EU). The motivation for this may be due to the fact that different value-added tax (VAT) without physical border control induces cross-border shoppers who pay the VAT of other countries rather than...

The purpose of this paper is to analyze Nash tax competition among governments that differ in geographical aspect such as their positions. Each government lying on a linear market maximizes its revenue with respect to its own commodity tax rate, taking into account the cross-border shopping...