The Power Politics of International Tax Cooperation: Why Luxembourg and Austria accepted automatic exchange of information on foreign account holders' interest income
Publikation: Arbeits- oder Diskussionspapiere und Berichte › Arbeits- oder Diskussionspapiere
Standard
The Power Politics of International Tax Cooperation : Why Luxembourg and Austria accepted automatic exchange of information on foreign account holders' interest income. / Hakelberg, Lukas.
San Domenico di Fiesole : European University Institute, 2014. (EUI Working Papers; Band 2014, Nr. 26).Publikation: Arbeits- oder Diskussionspapiere und Berichte › Arbeits- oder Diskussionspapiere
Harvard
APA
Vancouver
Bibtex
}
RIS
TY - UNPB
T1 - The Power Politics of International Tax Cooperation
T2 - Why Luxembourg and Austria accepted automatic exchange of information on foreign account holders' interest income
AU - Hakelberg, Lukas
N1 - © Lukas Hakelberg, 2014
PY - 2014
Y1 - 2014
N2 - Theories of tax competition predict that small countries competing with large countries benefit, as they find it relatively easy to substitute revenue lost in a tax cut with revenue gained from incoming foreign tax base. If small countries can only lose from tax co-operation, why are Luxembourg and Austria bound to agree to a revised EU Savings Tax Directive that will oblige them to automatically provide information on foreign account holders’ interest income to residence countries? Putting emphasis on the neglected issue of power, I show that Luxembourg and Austria were first coerced into bilateral agreements on automatic exchange of information by the United States, which then activated a most-favored nation clause contained in the EU Directive on Administrative Co-operation in Tax Matters.As a result, the two countries were under a legal obligation to also extend greater co-operation to EU partners.
AB - Theories of tax competition predict that small countries competing with large countries benefit, as they find it relatively easy to substitute revenue lost in a tax cut with revenue gained from incoming foreign tax base. If small countries can only lose from tax co-operation, why are Luxembourg and Austria bound to agree to a revised EU Savings Tax Directive that will oblige them to automatically provide information on foreign account holders’ interest income to residence countries? Putting emphasis on the neglected issue of power, I show that Luxembourg and Austria were first coerced into bilateral agreements on automatic exchange of information by the United States, which then activated a most-favored nation clause contained in the EU Directive on Administrative Co-operation in Tax Matters.As a result, the two countries were under a legal obligation to also extend greater co-operation to EU partners.
KW - Politics
KW - international political economy
KW - tax competition
KW - EU politics
KW - power politics
KW - tax policy
KW - Two-Step Approach
M3 - Working papers
T3 - EUI Working Papers
BT - The Power Politics of International Tax Cooperation
PB - European University Institute
CY - San Domenico di Fiesole
ER -