Corporate income taxes under pressure: why reform is needed and how it could be designed by Ruud de Mooij, Alexander Klemm, Victoria Perry (Editors) published by International Monetary Fund (2021)
“In recent years, newspaper headlines have featured terms such as “digital service taxes,” “paradise papers,” and “tax wars,” all referring to various issues in international taxation. These and related topics have long been discussed among tax experts from academia, businesses and policy circles. Recently, increased strains on government budgets after the global financial crisis and information that journalists have revealed about the very low global taxation of some large and profitable multinational corporations have triggered political and popular upheaval going far beyond the small group of tax insiders.
The COVID- 19 crisis has only amplified the importance of the international tax debate. While several multinational businesses— and many domestically oriented ones in all countries— are hard hit and fighting for survival, others are thriving and report record- high stock- market values and profits— most notably companies that are highly digitalized and those operating in the pharmaceutical sector. At the same time, the necessary and life- saving government interventions during the pandemic have increased public debt ratios to record levels, raising concerns about how to recover from this through future tax collections. This reinforces the need to fix what is sometimes called “a broken international tax system,” the revenue- raising ability of which has been under severe stress as a result of tax competition, issues in allocation of the tax base, and aggressive tax planning techniques…”
