Tax loss offset restrictions – Last resort for the treasury?An empirical evaluation of tax loss offset restrictions based on micro data
In Germany, the tax loss carry-forward of corporations significantly increased over the lastdecade. At the same time only a small percentage of losses have been effectively offset. Onepotential reason for this puzzle is that stricter loss offset restrictions have been introduced inrecent years. I use a newly developed micro simulation model for the German corporate sectorto evaluate the fiscal effects of these restrictions. Additionally, distributional breakdowns areprovided. I find that the restrictions on the use of tax loss carry-back are rather ineffectivewhile the newly introduced minimum taxation considerably increases yearly tax revenue by1.1 billion €.
Accounting and auditing. General ; Corporate taxation and accounting. General ; Tax-based determination of income and statement of net assets ; Individual Working Papers, Preprints ; GERMANY