Strategies of Multinationals and Government Revenues under Separate Accounting and Consolidation with Formulary Apportionment
(2005)
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- Authors
- Abstract
- (en) In 2001, the European Commission proposed replacing the current system of taxation of multinational companies by the taxation of a consolidated base then distributed for taxation purposes according to pre-established criteria. In this article, we build up a case study of an international investment. We use it first to compare the behaviour of a multinational in the current system and in the system under examination. This exercise permits a comparison of the effects of these strategies on the tax revenue of Member States and a discussion, in that context, of the changeover to consolidation and formulary apportionment, especially in terms of interjurisdictional distribution of tax revenue, degree of tax competition and political economy issues related to the adoption of the new system by either the entire European Union or by certain Member States in the context of an Enhanced Cooperation Agreement process.
- Affiliations
Louvain School of Management Accounting & Finance
Citations
Gérard, M. (2005). Strategies of Multinationals and Government Revenues under Separate Accounting and Consolidation with Formulary Apportionment. https://hdl.handle.net/2078.5/88722