Scandinavian Working Papers in Economics
Working Paper Series, Center for Fiscal Studies,
Uppsala University, Department of Economics
No 2014:11: TAXATION OF CROSS-BORDER LABOR INCOME AND TAX REVENUE SHARING IN THE ÖRESUND REGION
Mattias Dahlberg () and Ali Sina Önder ()
Additional contact information
Mattias Dahlberg: Tax Law, Uppsala University
Ali Sina Önder: Uppsala Center for Fiscal Studies, Postal: Department of Economics, Uppsala University, P.O. Box 513, SE-751 20 Uppsala, Sweden
Abstract: Due to the Nordic Tax Treaty, commuters pay their income taxes where they earn income. This creates problems in local government finances in Scania County of Sweden, because the number of commuters received on both sides of the Öresund Strait is not symmetric, but the flow from Scania County of Sweden into Copenhagen County of Denmark is about 25 times as large as the other way around. This paper aims to document as ymmetries in commuter flows in the Öresund Region and the loss in income tax revenue due to the asymmetric magnitudes in the flow of commuters. We propose renewed negotiations between Sweden and Denmark on the income taxation in the Öresund Region in order to sustain local public services in the region.
Keywords: Labor Taxation; Commuting; Model Tax Convention; Nordic Tax Treaty; Source vs.Residence Principle
JEL-codes: H24; H61; H71; J61; K34
13 pages, September 8, 2014
Full text files
299928_1201411.pdf
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