Taxation Report: OECD's Role, Tax Competition, and Country Examples

This report delves into the realm of taxation, particularly focusing on the role of the OECD (Organization for Economic Co-operation and Development) in fostering international cooperation and addressing common economic challenges. The report examines how OECD countries collaborate to understand and respond to social, environmental, and economic shifts, including the measurement and analysis of global trade and investment. A key aspect of the report is the analysis of tax competition among OECD members, using examples from Australia (property taxes) and Canada (personal income taxes). The report discusses the implications of tax structures, the impact of sub-central government tax policies, and the challenges in balancing economic growth with revenue generation. It also touches upon the mobility of tax bases and the influence of citizen preferences on public finance, providing insights into the dynamics of tax competition at both national and international levels. The report emphasizes the importance of understanding the interplay between tax policies and economic outcomes.

Running head: TAXATION
Taxation
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OECD (The organization for economic co-operation and development) offers the
forum under which the governments may work together for sharing experiences and seeking
solutions for the common problems. OECD countries work with the government for
understanding what drives the social, environmental and economic changes. Further, they
measure the global flows of investment and trade and the productivity. Moreover, they
compare and analyse the data for predicting the future trends. International standards are set
on wide range of factors starting from tax and agriculture to safety of the chemicals
(Oecd.org, 2018).
Example of tax competition of OECD members
Australia – property taxes
The obvious move for the countries for reducing the SCG (sub-central government)
tax competition is for changing the tax structure as well as to the tax less the bases of mobile
tax. Such move will lead to foster the property taxes and to the lesser extent the consumption
tax at the cost of personal income taxes and corporate taxes. It is particularly applicable to the
countries where CIT and PIT makes up significant part of the SCG tax revenue (Oecd.org,
2018). Tax interaction on property tax is the main yardstick for type of competition that
reflects the political competition as well as preference of citizens for the public services
instead of attempting to attract the bases of mobile tax. If the SCG tax autonomy is focussed
on giving the citizens power of shaping the structure and size of public finance without much
side effects in shifting from the tax bases, property taxes will be the best suite for sub-central
as well as for the local level. Property taxes are friendlier for the economic growth as
compared to other taxes and distortions from the tax reporting are small. However, despite of
the advantages, the property taxation declined as share of the SCG revenues majorly for the
reasons of political economy. As tax is highly capitalised and visible higher taxes reduces the

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values of property that leads to oppose of tax hikes for property owners (Alemani et al.,
2016).
Canada – Personal income taxes
Personal income taxes lessen the net income of the household and offer the incentive
for migrating to the places where the taxes on income is lower. Despite of wide researches
regarding taxation income and labour supplies, little evidences are there regarding impact of
labour taxes related to migration. As per the general rule, sub-central personal income taxes
seems less prone to the tax competition as compared to the taxes related to corporate business
owing to lower mobility of the households as compared to firm’s mobility. Inspite of
increasing the international labour mobility in few segments, the labour market still are
essentially national even regional (Jackson & McManus, 2016).

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References
Alemani, E., Klein, C., Koske, I., Vitale, C., & Wanner, I. (2016). New Indicators of
Competition Law and Policy in 2013 for OECD and non-OECD Countries.
In Competition law enforcement in the BRICS and in developing countries (pp. 59-
102). Springer, Cham.
Jackson, I., & McManus, J. (2016). The Importance of Collaboration and Competition Within
and Outside the OECD. International Journal of Business and Management, 11(9),
13.
Oecd.org. (2018). Retrieved 12 December 2018, from
https://www.oecd.org/tax/federalism/48817035.pdf
Oecd.org. (2018). Competition - OECD. Retrieved 12 December 2018, from
http://www.oecd.org/daf/competition/