Abstract
Professor Avi-Yonah addresses two questions:
“First, from the perspective of the corporation, should the corporation cooperate and pay the corporate tax, or should it engage in ‘strategic’ tax behavior designed to minimize or eliminate its corporate tax burden? Second, from the perspective of the state, should the state use the corporate tax just to raise revenue, or should it also try to use it as a regulatory tool to steer corporate behavior in directions that it deems beneficial to society?”
This comment is only directed towards the first question — which really is an important and highly topical question in global commercial environment.1
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Due to this there is no need to raise questions connected to the second question, e.g. concerning distributive taxation or a need to find some welfarist approach or other possible justifications for the use of taxes. A comprehensive overview of the welfarist approach is KAPLOW/SHAVELL, Fairness versus Welfare (2002).
The concept is from FRIEDMAN, The World Is Flat (2005).
See FRIEDMAN, Freedom and Capitalism (1962). Paradoxically enough from our present viewpoint, Friedman only recognized one social responsibility for the corporations: to generate profits for the benefit of shareholders.
See in general COMMENNE, Economic Actors’ Participation in Social and Environmental Responsibility (2006).
COMMENNE, id., at 64–66.
EUROPEAN COMMISSION, Corporate Social Responsibility: Encouraging best behaviour, June 15, 2006 (see http://ec.europa.eu/enterprise/library/ee_online/art11_en.htm).
U.K. Company Law Reform Bill, Explanatory Notes (2005), ch 324, Guidance (2005), ch 10 and 62. The concept originates from JENSEN, Value Maximization, Stakeholder Theory, and the Corporate Objective Function, 14/3 Journal of Applied Corporate Finance 8, 9 (2001), who stresses the importance of stakeholders for the value maximization.
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Timonen, P. (2008). Corporate Social Responsibility and Strategic Tax Behavior — Comment on the paper by Reuven S. Avi-Yonah. In: Schön, W. (eds) Tax and Corporate Governance. MPI Studies on Intellectual Property, Competition and Tax Law, vol 3. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-77276-7_14
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