2023-09-28 14:46:10 +00:00
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abstract: 'Since 1.7.2005 the EU Savings Tax Directive has ensured a minimum of
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taxation on foreign interest income by offering participating countries
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the opportunity either to apply a withholding tax or to exchange
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information on cross-border interest income. The aim of the paper is to
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examine why countries do not exchange information on interest income.
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The results suggest that the incentive to exchange information is
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weakened if the financial sector in a country is very profitable. A high
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profitability of the financial sector enables countries to maximize
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revenues from the corporation tax. A second reason for discouraging
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information exchange is related to the spillover effects on the domestic
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labor market. An inflow of financial capital is indirectly associated
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with the creation of employment and well-paid jobs. In its current form
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the savings tax directive enables individuals to avoid taxation, either
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by placing their income in non-participating countries or by investing
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in assets which are not part of the directive. Using German revenue data
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for 2005 and 2006 the paper shows that Germany receives significantly
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less revenue from countries applying a withholding tax. This result
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indirectly indicates that investors can take advantage of the
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directive''s loopholes. (C) 2008 Elsevier Inc. All rights reserved.'
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affiliation: 'Schwarz, P (Corresponding Author), Sachverstandigenrat, Drosselweg 36,
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D-76829 Landau, Rhineland Palat, Germany.
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Sachverstandigenrat, D-76829 Landau, Rhineland Palat, Germany.'
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author: Schwarz, Peter
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author-email: schwarz10de@yahoo.de
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author_list:
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- family: Schwarz
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given: Peter
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da: '2023-09-28'
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doi: 10.1016/j.irle.2008.12.001
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files: []
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issn: 0144-8188
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journal: INTERNATIONAL REVIEW OF LAW AND ECONOMICS
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keywords: 'European Union; Interest taxation; Information exchange; Withholding
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tax; Tax havens'
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keywords-plus: TAXATION; COMPETITION; FIRMS
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language: English
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month: JUN
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number: '2'
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number-of-cited-references: '29'
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pages: 97-105
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papis_id: 63b327b3dbb83649386b4f1e6abac416
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ref: Schwarz2009whyare
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researcherid-numbers: Vyacheslav, Gromyko/I-5054-2012
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tags:
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- review
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times-cited: '5'
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title: Why are countries reluctant to exchange information on interest income? Participation
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in and effectiveness of the EU Savings Tax Directive
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2023-10-01 08:15:07 +00:00
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type: article
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2023-09-28 14:46:10 +00:00
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unique-id: WOS:000265969800003
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usage-count-last-180-days: '0'
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usage-count-since-2013: '7'
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volume: '29'
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web-of-science-categories: Economics; Law
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year: '2009'
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