Harmonization of corporate income taxation in EU: experience for Ukraine

Olesia V. Vietska

Abstract


The process of harmonization of corporate income taxation in European Union is investigated in the article. The stages of acceptance of СССТВ are distinguished. Advantages and disadvantages of СССТВ from the position of separate member‟s states of European Union are set. The possible consequences of harmonization of corporate income taxation in European Union are divided on three directions: formula of income distribution, corporate income tax rate, and corporate income tax base. It is set that the old and new member states of European Union can have different consequences of corporate income taxation in European Union by virtue of different features of national economies. Size of economy, requirement in a capital, tax culture and moral, system of personal income taxation, accounting model, rates of GDP, and rates of inflation are considered to be the basic influencing factors. It is reasonable that distinctions in these factors require the different model for the construction of corporate income taxation. Thus, the new member states of European Union can suffer both from introduction of corporate income tax rate and corporate income tax base. It was grounded that full-scale including of Ukraine in the process of harmonization of corporate income taxation in European Union is impossible. It is related to the condition of Ukrainian economy. All analyzable factors fall behind from the new member states of European Union, and even more - from the old member states of European Union. Moreover, the aim of old member states of European Union is the maintenance of high standards, and new member states of European Union - bringing in foreign investments, and the aim of Ukraine is the solution of issue of fiscal deficit. All this requires the different model on the construction of corporate income taxation.

Keywords


harmonization of corporate income taxation; СССТВ; corporate income tax rate; corporate income tax base; European Union; old member states of EU; new member states of EU

Full Text:

PDF

References


Becker, J. & Fuest, C. (2010). Tax enforcement and tax havens under formula apportionment. Int Tax Public Finance, 17, 217-235. DOI: https://doi.org/10.1007/s10797-009-9121-4.

Bénassy-Quéré, A., Trannoy, A. & Wolff, G. (2014, July). Tax harmonization in Europe: Moving Forward. Les notes du conseil d’analyse économique, 14. Retrieved from www.cae-eco.fr.

Bettendorf, L., Van der Horst, A., De Mosij, R., Devereux, M. & S. Loretz (2009). The economic effects of EU-reforms in corporate income tax systems. Retrieved from http://ec.europa.eu/taxation_customs/sites/taxation/files/resources/documents/common/publications/studies/ccctb/cortax.pdf.

Said Business School (2015). CBT tax database. Retrieved from http://www.sbs.ox.ac.uk/faculty-research/tax/publications/data.

European Commission (2015). Common Consolidated Corporate Tax Base (CCCTB). Retrieved from http://ec.europa.eu/taxation_customs/taxation/company_tax/common_tax_base/index_en.htm.

OECD. Stat. (2015). Corporate income tax rate. Retrieved from http://stats.oecd.org/Index.aspx?DataSetCode=TABLE_II1.

Deloitte (2015). Corporate tax rates 2015. Retrieved from http://www2.deloitte.com/content/dam/Deloitte/global/Documents/Tax/dttl-tax-corporate-tax-rates-2015.pdf.

European Commission (2011). Council Directive on a Common Consolidated Corporate Tax Base (CCCTB) 2011.0058 (СТІ). Retrieved from http://ec.europa.eu/taxation_cus-toms/resources/documents/taxation/company_tax/common_tax_base/com_2011_121_en.pdf.

European Commission (2011, March). European corporate tax base: making easier and cheaper. Retrieved from http://europa.eu/rapid/press-release_IP-11-319_en.htm.

World Bank (2015). GDP (current US$). Retrieved from http://data.worldbank.org/indicator/NY.GDP.MKTP.CD/countries/UA-EU-7E?display=default.

EuroStat (2015). GDP and main components - current prices. Retrieved from http://ec.europa.eu/eurostat/en/web/products-datasets/-/NAMA_GDP_C.

World Bank (2015). GDP growth (annual %). Retrieved from http://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG/countries/EU?display=default.

World Bank (2015). GDP per capita (current US$). Retrieved from http://data.world-bank.org/indicator/NY.GDP.PCAP.CD?display=default.

James, R. & Hines, J. (2010). Income misattribution under formula appointment. Economic Review, 54, 108-120.

Karpowicz, A. (2014). EU-15 countries, new member states and harmonization of corporate income tax. University of Szeged Doctoral School in Economics. Retrieved from http://www.eco.u-szeged.hu/download.php?docID=40326.

KPMG International Cooperative. (2011). KMPG Guide to CCCTB. Retrieved from http://www.kpmg.com/ccctb.

Krajewska, A. Krajewski, S. (2007). Is Corporate Income Tax Harmonization Possible in an Enlarged European Union? Comparative. Retrieved from http://www.comparative.uni.lodz.pl/attachments/article/12/01_full.pdf.

McLure, Ch. E. (2007). Harmonizing Corporate Income Taxes in the European Community: Rationale and Implication. NBER. Retrieved from http://www.nber.org/chapters/c2361.pdf.

PWC (2011). Paying taxes 2012: The global picture.. Retrieved from http://www.pwc.com/gx/en/paying-taxes/assets/paying-taxes-2012.pdf.

PWC (2014). Paying taxes 2015: The global picture. Retrieved from http://www.pwc.com/gx/en/paying-taxes/pdf/pwc-paying-taxes-2015-low-resolution.pdf.

Pirvu, D. (2013). Why CCCTB Disadvantages less Developed Countries of the European Union. Practical Application of Science, Vol. 1, 1(1), 317-332.

European Commission (2011). Questions and Answers on the CCCTB. Retrieved from http://europa.eu/rapid/press-release_MEMO-11-171_en.htm?locale=en.

Schneider, F., Buehn, A. & Montenegro, C. (2010). New Estimates for the Shadow Economies all over the World. Department of economy of Johannes Kepler Universitдt Linz Retrieved from http://www.econ.jku.at/members/Schneider/files/publications/LatestResearch2010/SHADOW_ECONOMIES_ITax.pdf.

Schneider, F. (2015). Size and Development of the Shadow Economy of 31 European and 5 other OECD Countries from 2003 to 2015. Different Developments Department of economy of Johannes Kepler Universitдt Linz Retrieved from http://www.econ.jku.at/members/Schneider/files/publications/2015/ShadEcEurope31.pdf.

European Commission (2015). Tax Reforms in EU Member States 2015: tax policy challenges for economic growth and fiscal sustainability. Retrieved from http://ec.europa.eu/economy_finance/publications/eeip/pdf/ip008_en.pdf.

European Commission (2014). Taxation Trends in European Union. Retrieved from http://ec.europa.eu/taxation_customs/resources/documents/taxation/gen_info/economic_analysis/tax_structures/2014/report.pdf.

Dutta, S., Lanvin, B. & Wunsch-Vincent, S. (Eds.) (2015). The Global Innovation Index. Retrieved from https://www.globalinnovationindex.org/userfiles/file/reportpdf/GII-2015-v5.pdf.

OECD (2015). Top statutory personal income tax rate and top marginal tax rates for employees OECD.Retrieved from https://stats.oecd.org/Index.aspx?DataSetCode=TABLE_I7.

Transparency International (2010) Corruption Perceptions Index 2010. Retrieved from http://www.transparency.org/cpi2010/results.

Transparency International (2014). Corruption Perceptions Index 2014: results. Retrieved from https://www.transparency.org/cpi2014/results.

Van der Horst, A., Bettendorf, L. & Rojas-Romagosa, H. (2007). Will Corporate Tax Consolidation improve Efficiency in the EU? Tinbergen Institute Discussion Papers, 07-076/2. Retrieved from http://econpapers.repec.org/paper/tinwpaper/20070076.htm.

Vrijburg, H. (2010). 50 years of EU corporate income tax harmonization initiatives: Is Enhanced Cooperation the solution? People. Retrieved from http://people.few.eur.nl/vrijburg/Papers/Vrijburg%20(2010)%20chapter%20FEI%20BV.pdf.

Ernst & Young Global Limited (2015). Worldwide R&D incentives reference guide 2014-15. Retrieved from http://www.ey.com/Publication/vwLUAssets/EY-worldwde-randd-incentives-reference-guide/$FILE/EY-worldwide-randd-incentives-reference-guide.pdf.

PWC (2011). Alternative system for calculating taxable profits in the EU. Retrieved from https://www.ablv.com/ru/press/2011-06-03-alternativnaja-sistema-rascheta-nalogooblagaemoj-pribyli-v-es. [in Russian].

Amelin, A. (2015). The modernization of the profit tax will become the driver of economic growth. Retrieved from http://voxukraine.org/2015/08/26/modernizaciya-naloga-na-pribyl/ [in Russian].

Ministry of finance of Ukraine (2015). Statement by the Minister of Finance to the National Council reform 3 September 2015. Retrieved from http://www.minfin.gov.ua/news/view/vistup-ministra-finansiv-na-nacionalnij-radi-reform-3-veresnja-2015-roku?cate¬gory=dohidna-politika&subcategory=podatki [in Ukrainian].

Vyshnevskyi, V. & Vietska, O. (2011). Ways to improve the system of tax depreciation. Ekonomika Ukrainy, 2, 49-59 [in Russian].

State Statistics Service of Ukraine (2015). Retrieved from http://www.ukrstat.gov.ua [in Ukrainian].

The Price of the State (2015). Budget revenues Ukraine 2014. Retrieved from http://costua.com/budget/revenue/ [in Ukrainian].

Konrad, R. (2015). Tax reform is not Simply Changing the Law. Retrieved from http://voxukraine.org/2015/09/03/robert-conrad-tax-reform-is-not-simply-changing-the-law-ru [in Russian].

Kopchynska, K. (2015). European trends in the taxation of profits. Naukovyi visnyk Polissia, 2, 148-153 [in Ukrainian].

Kutyaeva, O. (2011). Britain is categorically against the single corporate tax base in Europe. Retrieved from https://gsl.org/ru/news/%D0%B1%D1%80%D0%B8%D1%82%D0%B0%D0%BD%D0%B8%D1%8F-%D0%BA%D0%B0%D1%82%D0%B5%D0%B3%D0%BE%D1%80%D0%B8%D1%87%D0%B5%D1%81%D0%BA%D0%B8-%D0%BF%D1%80%D0%BE%D1%82%D0%B8%D0%B2-%D0%B5%D0%B4%D0%B8%D0%BD%D0%BE/ [in Russian].

Kukhta, P. (2015). Tax Reform - What’s On the Table. Retrieved from http://voxukraine.org/2015/08/26/tax-reform-whats-on-the-table-ru/# [in Russian].

Kucherova, I. (2013). The convergence of national tax systems: Achievements and Prospects. Stalyi rozvytok ekonomiky, 4, 400-404 [in Ukrainian].

Lebedev, V. (2015). Tax pressure: external and internal. Ekonomicheskaia gazeta. Retrieved from http://www.neg.by/publication/2015_07_21_19855.html?print=1 [in Russian].

Markeze, S. (2006). General purpose financial statements and tax reporting. Retrieved from http://svitppt.com.ua/ekonomika/finansova-zvitnist-zagalnogo-priznachennya-ta-podatkova-zvitnist.html [in Ukrainian].

Independent News Bureau (2013). IMF recommends Ukraine to postpone a reduction in VAT and income tax rates. Retrieved from http://nbnews.com.ua/ru/news/103623/ [in Russian].

Melen, O. & Lykash, S. (2013). Current Issues Profit Tax. Visnyk NTUU “KhPI”, 67, 107-111 [in Ukrainian].

FINbalance (2015). Ministry of Finance - against the introduction in Ukraine of tax on distributed profits. Retrieved from http://finbalance.com.ua/news/Minfin-rozkritikuvav-ideyu-zaprovadzhennya-v-Ukrani-podatku-na-rozpodileniy-pributok [in Ukrainian].

Ministry of finance of Ukraine (2015). Tax reform. Retrieved from http://www.minfin.gov.ua/uploads/0/839-%20%D0%BF%D1%80%D0%BE%D0%B5%D0%BA%D1%82%D1%83%20%D0%9F%D0%BE%D0%B4%D0%B0%D1%82%D0%BA%D0%BE%D0%B2%D0%BE%D1%97%20%D1%80%D0%B5%D1%84%D0%BE%D1%80%D0%BC%D0%B8%20%D0%9C%D1%96%D0%BD%D1%96%D1%81%D1%82%D0%B5%D1%80%D1%81%D1%82%D0%B2%D0%B0%20%D1%84%D1%96%D0%BD%D0%B0%D0%BD%D1%81%D1%96%D0%B2%20%281%29.pdf [in Ukrainian].

Verkhovna Rada of Ukraine (2015). The explanatory note to the draft law on amendments to the Tax Code of Ukraine concerning liberalization of tax. Retrieved from http://w1.c1.rada.gov.ua/pls/zweb2/webproc34?id=&pf3511=56874&pf35401 =361619 [in Ukrainian].

NISS (2015). Strategic priorities and objectives of tax reform in Ukraine. Retrieved from http://www.niss.gov.ua/content/articles/files/podatkova_ref-21822.pdf [in Ukrainian].

Sushchenko, O. (2013). Harmonization of tax legislation in the EU: Current status and directions of further development. Finansy, oblik i audit, 2, 138-153 [in Ukrainian].

Trading Economics (2015). Ukraine - Core inflation price - forecast. Retrieved from http://ru.tradingeconomics.com/ukraine/core-inflation-rate/forecast [in Russian].

Odnako.su (2015). Ukraine received a forecast for GDP and inflation at once for three years (Infographics). Retrieved from http://odnako.su/news/finance/-412001-ukraina-poluchila-prognoz-po-vvp-i-inflyacii-srazu-na-tri-goda-infografika/ [in Russian].

Ulianova, N. & Derliuk, O. (2015). Ukraine: profit tax. Retrieved from http://icf-ua.com/article/ukraina--nalog-na-pribyl [in Russian].

Hamakers, H. (2004). Trends in the development of taxation in Europe. Nalogoved, 10. Retrieved from http://nalogoved.ru/art/102/ [in Russian].

Gazeta.ru (2015, September 23). The worst year of Ukraine Retrieved from http://www.gazeta.ru/business/2015/09/23/7772441.shtml [in Russian].

Holtsler, H., Libanova, E. & Efimenko, T. (2015). Survey Report of state support for business entities in Ukraine. Harmonisation of public procurement system of Ukraine with EU standards. Retrieved from http://eupublicprocurement.org.ua/wp-content/uploads/2015/04/STATE-SUPPORT-STUDY_UKR_20.04.2015.pdf [in Ukrainian].

Shavalyuk, L. (2015). New taxes as a means of combating the recession. What will the new tax system. Retrieved from http://tyzhden.ua/Economics/141087/PrintView [in Ukrainian].

Shevchuk, V. & Rymarska, R. (2008). Harmonization of tax legislation in the European Union: experience for Ukraine. Strategichni priorytety, 3, 100-111 [in Ukrainian].




DOI: https://doi.org/10.15407/econindustry2015.04.069

Refbacks

  • There are currently no refbacks.