Tax Competition: Quo Vadis? Trends and Effects on Family Businesses

This study provides an overview of current political developments in tax competition, emphasizing the consequences for large family businesses. We analyse new tax competition trends in Europe and selected industrialized countries in recent years. Subsequently, we discuss various international tax policy counter-reactions, namely the EU Anti-Tax Avoidance Directive, country-by-country reporting and the OECD’s two-pillar project, with respect to their impact on tax competition. We outline a potential shift in tax competition away from companies towards highly wealthy and highly qualified individuals. The implications of these developments on large family businesses are exemplarily shown for Germany, a country with a large share of family businesses.

Bührle, Theresa, Katharina Nicolay, Christoph Spengel and Sophia Wickel (2023), Tax Competition: Quo Vadis? Trends and Effects on Family Businesses, ZEW Discussion Paper No. 23-027, Mannheim.