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Licensed Unlicensed Requires Authentication Published by De Gruyter December 7, 2019

Sharing the Burden? Empirical Evidence on Corporate Tax Incidence

Nadja Dwenger, Viktor Steiner and Pia Rattenhuber
From the journal German Economic Review


This study investigates the direct incidence of the corporate income tax (CIT) through wage bargaining, using an industry-region level panel dataset on all corporations in Germany over the period 1998-2006. For the first time we account for employment effects which result from tax-induced wage changes. Workers share in reductions of the CIT burden; yet, the net effect of wage bargaining on the corporate wage bill, after an exogenous €1 decrease in the CIT burden, is as little as 19-28 cents. This is about half of the effect obtained in prior literature focussing on wages alone.

Published Online: 2019-12-07
Published in Print: 2019-12-01

© 2019 by Walter de Gruyter Berlin/Boston

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