The tax burden of companies in specific areas of the greater Alpine region: Inquiries and a comparative analysis

The tax burden of companies in specific areas of the greater Alpine region: Inquiries and a comparative analysis

Client/Allowance

BAK Basel Economics

Period: 01.06.2000 – 31.08.2001

The most recent survey of international companies conducted by BAK Konjunkturforschung Basel AG concludes that taxation is one of the most important considerations for companies when deciding where to locate. Furthermore, it is clear that the process of European integration is increasing tax competition between countries seeking to attract investment. Due to this development, Switzerland is in danger of losing the tax advantage it enjoys vis a vis other European countries. Switzerland is therefore considering implementing tax reforms in order to maintain and hopefully increase its attractiveness as place to conduct business. To that end, information concerning national and international indicators of companies’ tax burdens, including an international and inter-regional comparison of tax burdens, is required for decision-making purposes. The goal of this research project is to analyze the tax burdens of companies operating in designated areas within the greater Alpine region (eleven Swiss cantons, Baden-Wuerttemberg, Bavaria, and Eastern France) and compare them with those of other European regions as well as the United States and Canada. The first step of this process involves using King and Fullerton’s “Method for Determining Effective Marginal Tax Rates” to evaluate the effective tax burden experienced by domestic firms in the selected countries and regions. The second step will be to calculate the additional tax burden born by German companies engaged in cross-border investments in Switzerland. Following the completion of the first two steps, it will be possible to carry out the third step: comparing and evaluating the different areas within the extended Alpine region. This final step will assess the attractiveness of each area from a tax perspective by using the effective tax burden as an indicator of the burden of additional investment. This process will involve an investigation of the different aspects of taxation (type of taxes, tax system, tax base, and tax rates) and the influence of each on the tax burden. This research is expected to develop detailed information regarding the effective tax burden arising from additional investments by domestic and international companies within the extended Alpine region. The results are intended to serve as the basis for recommendations regarding potential changes to the Swiss tax system.

Project members

Robert Schwager

Robert Schwager

Project Coordinator
Research Associate

To the profile
Ulrich Schreiber

Ulrich Schreiber

Research Associate

To the profile
Client/Allowance
BAK Basel Economics, Basel, CH
Cooperation partner
University of Mannheim, Mannheim, DE

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