Oxford Business Tax Blog

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The Efficiency-Equity Tradeoff of the Corporate Income Tax

Business tax paper of the month – May 2024

Patrick Kennedy (UCLA, NBER, and JCT), 20 May 2024

The impact of corporate tax reforms is complex: reducing tax rates may boost investment, raise shareholders’ returns, and increase workers' earnings, but these benefits may be distributed unevenly throughout the economy. In this blog, the authors study these mechanisms in the context of the 2017 Tax Cuts and Jobs Act in the United States, and shed light on the trade-off between efficiency and equity facing policymakers when setting business tax policies.


Tax Policy and Investment in a Global Economy

Business tax paper of the month – April 2024

Gabriel Chodorow-Reich, Owen Zidar, and Eric Zwick, 17 April 2024

The Tax Cuts and Jobs Act (TCJA) of 2017 marked the most substantial reduction in corporate taxes in U.S. history, lowering the top corporate tax rate from 35% to 21%, altering investment incentives, and changing the treatment of international income. In this blog, the authors summarise recent research evaluating the TCJA's corporate tax provisions using administrative tax data and a new global investment model.

 


Figure 1: AEoI participation by income level

Harnessing global financial transparency to improve tax enforcement in developing countries

Niels Johannesen, 9 April 2024 

Governments have developed a potentially powerful approach to enforcing taxes on offshore financial income and wealth: automatic information exchange across borders. In this column, and in a recent paper, the author discusses whether the approach is suitable for developing countries with limited administrative capacity and whether there exists a better alternative. 
 


Designing fair and efficient child benefits

Kristoffer Berg, 11 March 2024
In the new Spring Budget, the Chancellor of the Exchequer Jeremy Hunt announced changes to child benefits in the UK. The changes imply higher child benefits for households in certain income groups and potentially a move towards linking child benefits to household rather than individual income. Different views about the fair priority in providing benefits to smaller versus larger households may imply different designs of child benefits, but there is also a trade-off between a fair system, administrative cost, and work incentives. 

 

 

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