THE CHOICE OF APPORTIONMENT FACTORS UNDER FORMULA APPORTIONMENT

• 成果类型: Article
• 署名作者: Runkel, Marco; Schjelderup, Guttorm
• 署名单位: Technical University of Berlin
• 刊物名称: INTERNATIONAL ECONOMIC REVIEW
• ISSN/ISSBN: 0020-6598
• DOI: 10.1111/j.1468-2354.2011.00654.x
• 发表日期: 2011
• 页码: 913-934
• 关键词: company tax-reform; taxation; income

摘要

This paper investigates the choice of apportionment factors under a corporate tax system of Formula Apportionment. In contrast to perceived wisdom, we show that the apportionment formula contains both mobile (capital) and immobile (labor) factors, regardless of whether the formula is determined decentrally by jurisdictions or centrally by a central planner. The central planner uses the formula as a corrective instrument to internalize fiscal externalities. We calibrate the model to the European Union and show that replacing the current system of Separate Accounting by Formula Apportionment would substantially increase tax revenue and welfare under both centralized and decentralized formula choices.