“Tax Incentives and Investments in the EU: Best practices and ways to stimulate private investments and prevent harmful tax practices” was published by the EU Parliament, Policy Department for Economy and Growth – Directorate-General for Economy, Transformation and Industry.
This study aims to evaluate the effectiveness of tax incentives within the EU, focusing particularly on incentives for research and development (R&D). The scope of the study covers an extensive analysis of both input-based incentives, such as tax credits and super deductions, and output-based incentives, including intellectual property (IP) box regimes. Its main objectives include assessing the impact of these incentives on private investment decisions, innovative activity in particular, as well as examining their compatibility with international tax regulations, specifically the OECD’s global minimum tax rules under Pillar Two. On that basis, the study identifies best practices in designing and implementing these incentives to effectively stimulate private investment while minimizing risks such as aggressive tax planning and harmful tax competition.
Read the STUDY