Collecting the Tax Deficit of Multinational Companies: Simulations for the EU

Authors: Mona Barake, Paul-Emmanuel Chouc, Theresa Neef, and Gabriel Zucman

This report estimates the amount of tax revenue that the EU could raise by imposing a minimum tax on the profits of multinational companies.

The study considers several scenarios for the imposition of such a tax — ranging from an international tax agreement to unilateral measures — and a range of rates. 

An international agreement on a minimum rate of 25% would allow the European Union to increase its tax revenues by 170 billion in 2021, an increase of 50% of the corporate tax revenue collected today. With a minimum rate of 15%, the additional tax revenue would only amount to about 50 billion euros.

An EU country that unilaterally chose to subject its multinationals to a minimum rate of 25% and taxed part of the tax deficit of non-resident companies accessing its market would increase its corporate tax revenues by around 70%.

Supplementary material: 

Simulation website: compute the tax deficit of multinational companies and simulate its collection

Replication archive for the report

GitHub repository for the report