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Tax Competition for FDI in Central-European Countries

Author

Listed:
  • Milan Sedmihradsky
  • Stanislav Klazar
Abstract
Most governments of the Central and East European countries adopted in 1990s tax measures for a support of foreign direct investments. Such measures usually include 10-year tax holidays and exemption from import duties. They are mostly accompanied by grants for building an infrastructure and creation of new jobs. As our data indicate and the statistical test has proved, the incentives are effective in attracting new FDI to the countries. However there are some indicators that a tax competition between the CEE countries exists.

Suggested Citation

  • Milan Sedmihradsky & Stanislav Klazar, 2002. "Tax Competition for FDI in Central-European Countries," CESifo Working Paper Series 647, CESifo.
    • Handle: RePEc:ces:ceswps:_647
    as

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    File URL: https://www.cesifo.org/DocDL/647.PDF
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    References listed on IDEAS

    as
    1. Wilson, John Douglas, 1999. "Theories of Tax Competition," National Tax Journal, National Tax Association;National Tax Journal, vol. 52(2), pages 269-304, June.
    2. Tanzi, Vito & Zee, Howell H., 2000. "Tax Policy for Emerging Markets: Developing Countries," National Tax Journal, National Tax Association;National Tax Journal, vol. 53(2), pages 299-322, June.
    3. Black, Dan A & Hoyt, William H, 1989. "Bidding for Firms," American Economic Review, American Economic Association, vol. 79(5), pages 1249-1256, December.
    4. Patrick Lenain & Leszek Bartoszuk, 2000. "The Polish Tax Reform," OECD Economics Department Working Papers 234, OECD Publishing.
    5. Wilson, John Douglas, 1999. "Theories of Tax Competition," National Tax Journal, National Tax Association, vol. 52(n. 2), pages 269-304, June.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Kovachev, Goran & Velkovska, Ivana & Garvanlieva Andonova, Vesna & Nikolov, Marjan, 2020. "Attracting foreign investment in the Western Balkan region and state aid: Race to the bottom or necessity?," MPRA Paper 101715, University Library of Munich, Germany.
    2. Bersan Haliti & Safet Merovci, 2020. "The Impact of the Investment Environment on Foreign Direct Investment (FDI) in the European Transition Economies," Economic Alternatives, University of National and World Economy, Sofia, Bulgaria, issue 1, pages 138-147, March.
    3. Huizinga, Harry & Nicodeme, Gaetan, 2006. "Foreign ownership and corporate income taxation: An empirical evaluation," European Economic Review, Elsevier, vol. 50(5), pages 1223-1244, July.
    4. Nada Massoud, 2003. "Assessment of FDI Incentives in Egypt," Working Papers 0336, Economic Research Forum, revised 11 2003.
    5. Kolasa Marcin, 2008. "How does FDI inflow affect productivity of domestic firms? The role of horizontal and vertical spillovers, absorptive capacity and competition," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 17(1), pages 155-173.
    6. Przemysław Kulawczuk, 2005. "Konkurencja podatkowa i socjalna o zagraniczne inwestycje bezpośrednie w przemyśle Europy Środkowej," Gospodarka Narodowa. The Polish Journal of Economics, Warsaw School of Economics, issue 10, pages 53-75.
    7. Marina Purina, 2021. "Human Freedom and Effective Corporate Income Tax Rates of CEE Listed Companies," European Financial and Accounting Journal, Prague University of Economics and Business, vol. 2021(2), pages 05-28.
    8. Kovachev, Goran & Velkovska, Ivana & Garvanlieva Andonova, Vesna & Nikolov, Marjan, 2020. "Привлекување На Странските Инвестиции Во Регионот На Западен Балкан И Државната Помош: Трка До Дното Или Неопходност? [Attracting foreign investments in the Western Balkans region and state aid: a ," MPRA Paper 101299, University Library of Munich, Germany.
    9. Katona, Klára, 2006. "A magyarországi tőkeimportot befolyásoló tényezők újraértelmezése [Reinterpretation of the factors influencing capital imports into Hungary]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(11), pages 986-1001.
    10. Akujuru, Chukunonye A. (PhD) & Enyioko, Newman C. (PhD), 2022. "Ease of Doing Business Policy and Efficiency of Public Enterprise in Nigeria," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 6(11), pages 501-522, November.
    11. Michal Sosnowski, 2015. "Tax competition and the relocation process," Ekonomia i Prawo, Uniwersytet Mikolaja Kopernika, vol. 14(1), pages 33-45, March.
    12. Haliti Bersan & Merovci Safet & Hetemi Alban & Sherpa Sanjib, 2019. "The Impact of the Ease Doing Business Indicators on Foreign Direct Investment in the European Transition Economies," Ekonomika (Economics), Sciendo, vol. 98(2), pages 19-32, December.

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