This paper was first published by the OECD. Citation: Dressler, L. and R. Warwick (2025), “Corporate income tax, investment, and the Net-Zero Transition: Issues for consideration”, OECD Taxation Working Papers, No. 73, OECD Publishing, Paris, https://doi.org/10.1787/08e15e33-en.
The transition to net-zero emissions demands unprecedented private sector investment in clean technologies. Corporate income tax (CIT) design, while often overlooked in climate discussions, significantly influences these investment decisions. This paper by the OECD presents a conceptual framework identifying key channels through which CIT affects clean investment and the factors mediating this relationship. By examining these interconnections, the authors derive policy implications and options for better aligning corporate taxation with climate objectives—providing timely insights for jurisdictions working to create fiscal environments conducive to meeting ambitious net-zero commitments.
Read the full working paper.