Commodity Tax Competition and Industry Location Under the Destination- and the Origin-Principle

Various studies have emphasised the trade and/or revenue implications of free trade. The purpose of this study is to investigate future tax implications of further economic integration. Additional considerations are whether tax competition can become an issue and whether it can be used to the benefit of all SADC members. An integrated approach was done of what is needed in terms of commodity taxation to reach a workable long-term solution. This article analyses experiences in the developing world with reference to lessons learned from developed regions. The first section provides a theoretical background, analysing the meaning of commodity tax. The second section emphasises the importance of fiscal decentralisation in federations and the SADC and the third investigates the character of and changes in commodity taxation that could occur in the future.

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Cross-Border Shopping and Commodity Tax Competition in Imperfectly Competitive Markets

Journal of Economic Research (JER) ◽

10.17256/jer.2008.13.2.001 ◽

2008 ◽

Vol 13 (2) ◽

pp. 183-210

Author(s):

이성규

Keyword(s):

Tax Competition ◽

Competitive Markets ◽

Cross Border ◽

Imperfectly Competitive ◽

Commodity Tax

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Elektronischer Handel und Steuerstaat: Neue Herausforderungen in der Neuen Ökonomie

Zeitschrift für Wirtschaftspolitik ◽

10.1515/zfwp-2003-0107 ◽

2003 ◽

Vol 52 (1) ◽

Author(s):

Jürgen Stehn

Keyword(s):

International Trade ◽

Tax Competition ◽

Income Tax ◽

New Economy ◽

Income Taxation ◽

Identification Problems ◽

Goods And Services ◽

Main Challenge ◽

International Tax Competition ◽

Origin Principle

AbstractThe article analyses the reform pressure on turnover and income tax systems stemming from the upsurge of crossborder B2C and B2B electronic commerce. It shows that the main challenge of the New Economy is to effectively cope with B2C international trade in digital online goods and services. However, most approaches to turnover taxation discussed in the literature give rise to several surveillance, efficiency, incentive, and identification problems. As a consequence, there seem to be only two appropriate approaches to deal with the special characteristics of international trade in cyberspace, the country-of-origin principle combined with a taxation of digital goods and services at the physical location of producers, and the community principle in combination with a withholding tax (WITHVAT). Moreover, it is shown that the special characteristics of the New Economy lead to a fiercer international tax competition with regard to income taxation.

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