Strong Competition Equals Strong Reforms? A New Perspective on Corporate Tax Reforms in 15 EU Countries (1998–2011)

Abstract Although many EU countries have reduced corporate taxes in the recent years, there is still a substantial variance between the 12 oldest EU-member states. This contribution revisits this variation and analyses the determinants of corporate tax reforms and their magnitude from a perspective which is new in two respects. First, we combine logistic panel regression and fuzzy-set qualitative comparative analysis (fsQCA) analysis allowing for an integration of qualitative assessments of tax reforms in the QCA analysis. This adds to the existing studies on tax reform which almost exclusively rely on regression techniques. Second, we focus on the time period 1998–2011 where we expect tax competition to be especially intense. The results of our analyses confirm the major impact of tax competition on national corporate tax policies. This relationship dominates the regression analyses as well as the fsQCA. Furthermore, our findings allow nuancing the existing results on the influence of institutional constraints and partisan politics.