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The project integrates the simulation of wealth taxes into EUROMOD to significantly broaden the scope of policy evaluation and analysis. For this purpose the Household Finance and Consumption Survey (HFCS) of the European Central Bank is adapted for its use in EUROMOD.

The project integrates the simulation of consumption taxes (i.e. VAT and excises) into EUROMOD to significantly broaden the scope of policy evaluation and analysis.

The project aims at quantifying the fiscal and equity effects of tax evasion in order to bring the simulation of tax reforms in line with country-specific peculiarities. For now, a pilot study focuses on three countries (Denmark, Estonia and Spain) but the project is planned to cover a broader range of Member States in the future. The methodology complements survey with administrative data to estimate the share of employment income, which is not reported to tax authorities.

The Five Presidents' Report (2015) calls for strengthening economic policy coordination and setting EU wide standards. In his 2016 State of the Union Address President Juncker said that we need a better Union that protects its citizens, among other priorities, as Europe is a social market economy. He also set as a priority the presentation of the Pillar of Social Rights, which calls for effective unemployment benefits. In this policy context, the discussion about convergence of national unemployment benefits schemes is high on the political agenda in the EU.

This study measures the fiscal and redistributive effects of hypothetical tax reforms implemented in EU Member States, taking into account the behavioural effects resulting from the adjustment of the labour supply and the economy-wide reaction to tax policy changes.

The purpose of this project is to assess the budgetary and distributional impact of reforming tax expenditures (e.g., allowances, exemptions, tax credits, etc) which constitute an important amount of forgone government revenue. The approach consists in comparing the tax-benefit system in place with a benchmark tax system without tax expenditures for pensions, housing, education and health. The project covers all Member States and focuses on health, pension, housing and education tax expenditures.

The thematic research on fiscal policy consists in a series of studies which place analytical focus on topics related to fiscal policy simulations and modelling.

The thematic studies comprehend different aspects of taxation, and aim at shedding light into specific research questions related to EU Member States tax and benefit systems, deepening the understanding of relevant tax issues.

Innovation is deemed to be a major driver of economic growth, employment and competitiveness. This view is reflected in most countries having some form of policy to provide incentive to perform Research & Development (R&D) investments. The mix of such policies is however very heterogeneous: while some countries prefer subsidies or public procurement, other rely more on tax incentives. The effects of innovation policies on the economy are complex as they depend upon many variables, not least upon the institutional and technological context within which economic agents operate.

Corporate tax rates in developed economies are subject to intense public debate. Competition for mobile capital has prompted a number of countries to envisage lowering their corporate tax rates in order to attract foreign investors. The EU has been particularly exposed to these changes given that capital can move freely across borders.

In most countries, interest on debt and the returns to equity capital are treated differently for the purposes of defining tax liabilities. Because interests are deductible from the corporate tax base while returns to equity are not, this introduces a tax advantage for debt financing which distorts financial decisions made by firms and investors. Moreover, it provides multinational groups with an additional channel to shift profits to affiliates in low-tax countries.

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