Taxes in the automotive and telecommunications industries of the usa: Evolution and comparison with the European Union

Abstract

The aim of this article is to define the meaning of tax competition. More specifically, it carries out a comparative analysis between the European Union and the United States of America studying two key sectors of their economies, the motor industry and telecommunications with the aim of featuring which of these is more tax competitive. The comparison criteria are VAT and sales tax, excise duties, corporate income tax, wage costs and in particular the tax burden on labor, taxing savings and duties on trade. In some cases, the EU seems to be more competitive, and in other cases, the USA does so. With regard to motor industry and telecommunications, it seems that in most of the criteria featured, they are affected according to the rest areas of economy. We conclude that the issue of tax competition, and in particular the comparison between the EU and the USA, needs further investigation. Finally, substantial tax reforms as a means of promoting healthy tax competition, seems to be desiderata by both parties. © 2020 Asociacion Euro-Americana de Estudios del Desarrollo. All rights reserved.