The international competitive tax avoidance

Abstract

Economic and financial globalization in the current international economic arena has generated a factor of interest in the promotion of foreign direct investment such as the promotional strategies, through several governmental tools, governmental or private under governmental supervision. Such strategies aim to attract international companies that act globally; and offer multiple choices and alternatives for positioning under the shade of competitiveness of states such as tax incentives for attracting and hosting this kind of investment. The generosity and competition between states in the provision of tax incentives for these foreign investments may drag negative effects, making the international tax competition harmful to these countries on the one hand and to the states participating in the market on the other hand. This paper aims to investigate this phenomenon by suggesting solutions of the experiences of some countries affiliated under regional unions.