On September 18, 2017 the OECD published Taxation Working Papers No. 32 titled: “Legal tax liability, legal remittance responsibility and tax incidence -Three dimensions of business taxation”, which was drafted by Anna Milanez.

According to the author: “This paper examines the role of businesses in the tax system. In addition to being taxed directly, businesses act as withholding agents and remitters of tax on behalf of others. Yet the share of tax revenue that businesses remit to governments outside of direct tax liabilities is under-studied. This paper develops two measures of the contribution of businesses to the tax system and applies both these measures for 24 OECD countries. The results show that businesses play an important role in the tax system, both as taxpayers and as remitters of tax. However, care should be taken in interpreting any measure of the business tax burden, which must be understood against the backdrop of economic incidence. This paper highlights that the economic incidence, or burden, of a tax is not necessarily borne by the person on whom the tax is imposed under legal statute, but may be passed on to others in the economy, whether it be owners of capital, workers or consumers.

The 76 page paper discusses a.o. the following subjects:

·   Legal Tax Liability and Legal Remittance Responsibility

o  Measuring the Full Range of Businesses’ Legal Tax Liabilities

o  Businesses’ Role in Remitting Taxes

o  Measuring the Economic Incidence of Business Taxes and Tax-Related Compliance Costs on Capital Owners

·   Revenue Statistics Data

o  Taxes on Income, Profits and Capital Gains (Revenue Statistics Category 1000)

o  Social Security Contributions (Revenue Statistics Category 2000)

o  Taxes on Payroll and Workforce (Revenue Statistics Category 3000)

o  Taxes on Property (Revenue Statistics Category 4000)

o  Taxes on Goods and Services (Revenue Statistics Category 5000)

o  Other Taxes (Revenue Statistics Category 6000)

o  Summary of Business Tax Remittance across OECD Countries

·   A Review of the Literature on Economic Incidence

o  Evidence on Economic Incidence by Tax Category

o  Economic Incidence & Legal Remittance Responsibility

 

Click here to be forwarded to the OECD Taxation Working Papers No. 32 as available on the website of the OECD.

 

 

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