Emergent Influences in the EU Corporate Tax Ecology: Modes of Tax Governance in the CCCTB and Supranational Tax Reform

Karl Henrik Smith & Sindre Garathun Ramseng

Student thesis: Master thesis


In 2013, over 100 countries collaborated on the implementation of the OECD/G20 Base Erosion and Profit Shifting (BEPS) Package to address profit shifting tax schemes. Following a series of failed legislative initiatives by the European Commission to tackle corporate tax planning strategies, the OECD’s BEPS project triggered the re-launch of the Common Consolidated Corporate Tax Base (CCCTB) proposal in 2016, a directive which would create a single set of rules for corporations operating in the EU to calculate their taxable income. Though the former proposal had been tabled in 2011 due to a lack of consensus by European Member States, the new two-step approach of the CCCTB garnered more approval, consisting of a first step creating a common taxable base for corporations, and a second step adding an apportionment formula for corporations to distribute their consolidated tax base. The re-introduction of the proposal carries many implications for national tax regimes in the EU, reflected by the continued fragmentation of national tax initiatives across Member States. In European tax governance, professional and institutional forces are increasingly shaping tax policy outcomes. Although traditional IPE literature ascribes an essential role to state actors as the principal policy-making organ, an increasing number of scholars argue that state power in the EU has diminished, leading to the emergence of other actors in national policy outcomes, namely supranational institutions (Commission, Parliament, Council) and professions in international organizations (IOs) and in the public, private, and academic sectors. European tax governance is increasingly characterized by emergent networks of influence, where policy formulation and bargaining processes occur in a ‘realm of contestation’ between actors and coalitions. To evaluate the influence of professionals and institutions on the CCCTB, this thesis employs a heuristic case study on the directive and a ‘snapshot’ of two recent national initiatives (in Latvia and the Netherlands) to draw feasible hypotheses about the policy-making process and policy content, in line with critical realist tradition.

EducationsMSc in International Business and Politics, (Graduate Programme) Final Thesis
Publication date2018
Number of pages114
SupervisorsLeonard Seabrooke