This working paper presents the analytical framework used by the Secretariat to estimate the direct effects of the Pillar One and Pillar Two proposals on MNE’s investment costs. The analysis builds on the standard ETR framework and extends it in two important respects. First, ETRs are...

R&D tax incentives have become a widely used policy tool to promote business R&D. How do they shape firms’ incentives to invest in R&D? This paper contributes a methodology to construct forward-looking effective tax rates for an R&D investment that reflect the value of expenditure-based R&D...

Tax incentives such as intellectual property regimes provide for reduced taxation of the income derived from research, development, and innovation related activities. By doing so, they lower the overall tax burden from investing in certain qualified intangible assets. This paper proposes a...