GLOBALIZATION AND TAX COMPETITION IN CENTRAL ASIAN COUNTRIES

Higher mobility of capital and labor during the age of globalization has led to tax competition between countries. After the collapse of the USSR, with the liberalization of economies, all post-Soviet countries faced the globalization process. Post-Soviet countries adopted tax law in a short period and during transition reduced tax rates, especially rates of corporate tax and income tax. This paper analyzes the level of tax competition in selected Central Asian countries as Kyrgyzstan, Kazakhstan, and Uzbekistan by implementing Clemente-Montano-Reyes Unit Root Test. Foreign yearly direct investment inflow data and corporate tax rate between 1992-2017 was used. Empirical results showed that tax reforms cause an effect on the level of foreign direct investment inflow in all three countries. But, along with this, ensuring economic development and stability could have a more significant effect on the inflow of foreign direct investment.

Anahtar Kelimeler:

foreign direct investment, tax policy, tax competition, Central Asia

GLOBALIZATION AND TAX COMPETITION IN CENTRAL ASIAN COUNTRIES

Keywords:

foreign direct investment, tax policy, tax competition, Central Asia,

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