The impact of R&D tax incentives on R&D costs and income tax burden

Elschner, Christina ; Ernst, Christof

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URN: urn:nbn:de:bsz:180-madoc-22492
Document Type: Working paper
Year of publication: 2008
The title of a journal, publication series: None
Publication language: English
Institution: Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series: Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject: 330 Economics
Classification: JEL: H25 O38 O31 ,
Subject headings (SWD): Europäische Union , Forschung und Entwicklung , Steuervergünstigung , Körperschaftsteuer , Steuerbelastung , Forschungskosten
Keywords (English): R&D , Tax incentives , Corporate Tax Burden , EU
Abstract: We analyse R&D tax incentives in a detailed way considering a multi-period setting and economic assumptions which reflect a realistic economic environment. We measure the incentive's impact on the firm's total tax payments and the R&D cost by means of the simulation model European Tax Analyzer. Using different economic settings and model firms, we run sensitivity analyses and get by that a more detailed view on the effects from R&D tax incentives against the background of the framing tax system. We find that not so much the kind but rather the specific design of R&D tax incentives, the interplay with the framing tax system and the firm's profitability relative to the level of R&D expenditures heavily influence the amount of tax subsidy for R&D.
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Das Dokument wird vom Publikationsserver der Universitätsbibliothek Mannheim bereitgestellt.

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