Research in Taxation

Taxes serve three main purposes: 1) Generate revenue for governments to fund their expenditures, 2) redistribute wealth within societies, and 3) steer behavior. Taxes are of great economic significance to companies as they constitute a major cash outflow and affect group structures of multinationals. But taxation not only influences business decisions. It also affects the political agenda of many countries facing questions such as how to combat tax avoidance and tax the digital economy. Moreover, governments increasingly use taxes to put a price on pollution addressing societal challenges such as climate change. Because of such developments, businesses are more and more affected by tighter regulations requiring them to provide extensive documentation. Thus, tax compliance has become almost as important as setting up tax-efficient group structures.

Given taxation’s broad objectives and implications, research in taxation covers a wide area of topics, ranging from tax avoidance to tax compliance, from investment decisions to locational decisions, and from tax enforcement to environmental enforcement. All these topics are at the core of companies’ decision making due to their large economic consequences. In this Ph.D. project, you can choose to investigate the role of taxation in one or more of the following areas: (i) investment, financing, or locational decisions of companies (especially in the light of new OECD and EU regulation), (ii) tax enforcement and digitalization of taxation, or (iii) the impact of environmental taxes on business decisions (e.g., CO2 emission certificates).

Business taxation, Individual income taxation, Business decisions, Tax Enforcement, Transfer pricing, Environmental taxation

Taxes serve three main purposes: 1) Generate revenue for governments to fund their expenditures, 2) redistribute wealth within societies, and 3) steer behavior. At the individual and company level, taxes are a major cash outflow, affect group structures of multinationals, and require increasing documentation and compliance efforts. In addition, governments increasingly use taxes to steer corporate behavior, such as by putting a price on pollution via taxes to address challenges such as climate change. Thus, taxation covers a wide area of topics ranging from tax avoidance to tax compliance, from investment decisions to locational decisions, and from tax enforcement to environmental enforcement. All these topics are at the core of companies’ decision making due to their large economic consequences.

Countries must balance their interests in generating tax revenue with the benefits from attracting foreign investments when setting their corporate income tax rate. Economically less powerful countries (as measured by GDP) often choose lower corporate income tax rates than economically more powerful countries to attract foreign direct investments. Such tax competition among countries and their tax codes creates possibilities for corporate tax avoidance. As a result, taxation ranks high on the political agenda of many countries with topics such as how to combat tax avoidance, how to tax the digital economy, or how to price CO2 emissions. Each of these topics has cross-border implications and requires internationally coordinated changes of national tax codes. International organizations such as the OECD or EU are major forces in implementing such coordinated changes to national tax codes. A spillover effect of these changes is that new and tighter tax legislation often requires businesses to provide more documentation, which makes tax compliance as important as managing the tax burden effectively.

In this dissertation project, you can choose to investigate the role of taxation in one or more of the following areas: (i) investment, financing, or locational decisions of companies (especially in the light of new OECD and EU regulation), (ii) tax enforcement and digitalization of taxation, or (iii) the impact of environmental taxes on business decisions (e.g. CO2 emission certificates). You are encouraged to identify impactful research questions that are of scientific and societal relevance. Potential research questions can relate but are not limited to the following areas: Where do companies and individuals invest, considering factors such as tax attractiveness, government effectiveness, and tax uncertainty? What is the role of digitization in tax avoidance and tax compliance? What are the societal and economic consequences of taxing carbon emissions?

The research methodology used in this project is archival-based, using financial (accounting, tax and price) data from commercial databases and panel data econometric methods.

The candidate has (a) a background in taxation, accounting, finance, economics, or econometrics, (b) good quantitative skills, and (c) an international focus.

Required by ERIM

All application documents required by ERIM can be found here: https://www.erim.eur.nl/doctoral-programme/phd-in-management/admissions/application/  

Below are the test scores required by ERIM:

- GMAT/GRE scores above the 85th percentile, not older than 5 years

- IELTS/TOEFL test scores, not older than 2 years:

  IELTS: minimum overall band score 7.5; no band score lower than 6.5

  Internet-based TOEFL: minimum total score 100, no sub-score lower than 23

  Paper-based TOEFL: minimum score 600

The PhD candidate is expected to complete three research papers (leading to a dissertation) that are potentially publishable in leading accounting journals such as The Accounting Review, Journal of Accounting Research, Journal of Accounting and Economics, Review of Accounting Studies and Contemporary Accounting Research.

The decision to cooperate with other universities or research groups depends on future project choices. It is expected, however, that the Ph.D. candidate will spend at least 6 months at an international university as a visiting scholar.

Taxation serves several purposes in societies such as 1) Generate revenue for governments to fund their expenditures, 2) redistribute wealth within societies, and 3) steer behavior. These purposes and features of well-designed tax systems can address pressing societal challenges such as reducing inequality, stimulating investments and economic activity, and combating climate change.

Tax legislation and tax research are a quickly developing areas where many new laws are passed to curb tax avoidance, enhance transparency and tax enforcement, and to address environmental issues. Tax research in any of the above-mentioned areas contributes to state of the art research on economic and societal consequences of different types of taxes and tax enforcement.

Bachas, P. J., Fattal Jaef, R. N., Jensen, A. (2018). Size-dependent Tax Enforcement and Compliance: Global Evidence and Aggregate Implications, Policy Research working paper No. 8363 Washington, D.C.: World Bank Group. Available at: http://documents.worldbank.org/curated/en/768971520865898064/Size-dependent-tax-enforcement-and-compliance-global-evidence-and-aggregate-implications

Blouin, J., Robinson, L. (2021). Double counting accounting: How much profit of multinational enterprises is really in tax havens? Available at: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3491451

De Simone, L., Klassen, K. J., Seidman, J. K. (2017). Unprofitable affiliates and income shifting behavior, The Accounting Review 92, 113-136.

Dyreng, S. D., Lindsey, B. P., Markle, K. S. Shackelford, D. A., 2015, “The effect of tax and nontax country characteristics on the global equity supply chains of U.S. multinationals”, Journal of Accounting and Economics 59, 182-202.

Dyreng, S. D., Hoopes, J., Wilde, J. (2016). Public pressure and corporate tax behavior, Journal of Accounting Research, 54, 147-186.

Hanlon, M., & Heitzman, S. (2010). A review of tax research. Journal of Accounting and Economics, 50(2–3), 127-178.

Heckemeyer, J.H. & Overesch, M. (2017). Multinationals' profit response to tax differentials: Effect size and shifting channels. Canadian Journal of Economics, 50(4), 965-994.

Köppl, A. & Schratzenstaller, M. (2021). Effects of environmental and carbon taxation: A literature review. WIFO Working Papers 619/2021. Available at: www.econstor.eu/handle/10419/231459

Kovermann, J., & Velte, P. (2019). The impact of corporate governance on corporate tax avoidance—A literature review. Journal of International Accounting, Auditing and Taxation, 36, 100270.

Metcalf, G. E. (2019). On the economics of a carbon tax for the United States. Brookings Papers on Economic Activity (Spring), 405–484.

OECD (2013). Action plan on base erosion and profit shifting. Paris: OECD Publishing.

OECD (2021). Two-pillar solution to address the tax challenges arising from the digitalization of the economy. Paris: OECD Publishing.

Slemrod, J. (2019). Tax Compliance and Enforcement. Journal of Economic Literature, 57(4), 904-954.

Wilde, J. H., & Wilson, R. J. (2018). Perspectives on corporate tax planning: Observations from the past decade. Journal of the American Taxation Association, 40(2), 63-81.

ERIM offers fully-funded and salaried PhD positions, which means that accepted PhD candidates become employees (promovendi) of Erasmus University Rotterdam. Salary and benefits are in accordance with the Collective Labour Agreement for Dutch Universities (CAO) .

For questions regarding the PhD application and selection procedure, please check the Admissions or send us an e-mail via [email protected] .

ERIM is the research institute of management at Erasmus University Rotterdam, founded by Rotterdam School of Management, Erasmus University (RSM) and Erasmus School of Economics (ESE), both of which excel in their research and teaching programmes. The level and international character of their research and teaching programmes has put both schools at the forefront of academic excellence. They offer a diversified portfolio of accredited teaching and research programmes, ranging from pre-experience MSc to postgraduate Masters and executive development, and from fundamental research to applied research and business support, which are renowned throughout the world. RSM is one of the few schools worldwide that holds a triple accreditation from the AMBAs, EQUIS and the AASCB, and is positioned among the top European business schools. The scientific staff of both schools plays a major role in the schools’ interaction with the international business community.

ERIM distinguishes itself by the high-level and international character of its research and has repeatedly been ranked among top 3 research institutes in Europe. ERIM’s key aims are top-quality academic research with impact both on academia and managerial practice, and the advancement of international academic careers and high-level support for both research and doctoral education. For more information about ERIM please visit [link:https://www.erim.eur.nl].