Financial Taxes and the Sand in the Wheels of Financialization:Legal Challenges for the EU Directive Implementing Enhanced Cooperation in the Area of Financial Transaction Tax

One of the many results of the Global Financial Crisis was the insight that the financial sector is under-taxed compared to other industries. In light of the huge bailouts and continued subsidies for financial institutions that are characterized as too-big-to-fail demands came on the agenda to make finance pay for the mega-crisis it caused. The most prominent examples of such taxes are a Financial Transaction Tax (FTT) and a Financial Activities Tax (FAT). Possible effects of such taxes on the economic constitution and increasingly in particular on the European Single Market have been discussed controversially over the last decades already. Especially with the decision of eleven EU member states to adapt an FTT using the enhanced cooperation procedure a number of additional legal challenges for implementing such a tax have emerged. This paper analyzes how tax measures of indirectly regulating the financial industry differ, what legal challenges they pose, and what their overall contribution would be in making the financial system more stable and resilient. It also analyzes the legal arguments against enhanced cooperation in this area and the legal issues related to the British lawsuit against the Commission’s Directive proposal in the European Court of Justice on grounds of the extra-territoriality application of tax. The paper concludes that the feasibility of an FTT is legally sound and given the FTT’s advantages over a FAT the EU Directive should be implemented as a first step for a European-wide FTT. However, significant uncertainties about its implementation remain at this stage.

Identification of the Flagellin Glycosylation System in Burkholderia cenocepacia and the Contribution of Glycosylated Flagellin to Evasion of Human Innate Immune Responses

Burkholderia cenocepacia is an opportunistic pathogen threatening patients with cystic fibrosis. Flagella are required for biofilm formation, as well as adhesion to and invasion of epithelial cells. Recognition of flagellin via the Toll-like receptor 5 (TLR5) contributes to exacerbate B. cenocepacia-induced lung epithelial inflammatory responses. In this study, we report that B. cenocepacia flagellin is glycosylated on at least 10 different sites with a single sugar, 4,6-dideoxy-4-(3-hydroxybutanoylamino)-d-glucose. We have identified key genes that are required for flagellin glycosylation, including a predicted glycosyltransferase gene that is linked to the flagellin biosynthesis cluster and a putative acetyltransferase gene located within the O-antigen lipopolysaccharide cluster. Another O-antigen cluster gene, rmlB, which is required for flagellin glycan and O-antigen biosynthesis, was essential for bacterial viability, uncovering a novel target against Burkholderia infections. Using glycosylated and nonglycosylated purified flagellin and a cell reporter system to assess TLR5-mediated responses, we also show that the presence of glycan in flagellin significantly impairs the inflammatory response of epithelial cells. We therefore suggest that flagellin glycosylation reduces recognition of flagellin by host TLR5, providing an evasive strategy to infecting bacteria.

Epstein-Barr Virus Large Tegument Protein BPLF1 Contributes to Innate Immune Evasion through Interference with Toll-Like Receptor Signaling

Viral infection triggers an early host response through activation of pattern recognition receptors, including Toll-like receptors (TLR). TLR signaling cascades induce production of type I interferons and proinflammatory cytokines involved in establishing an anti-viral state as well as in orchestrating ensuing adaptive immunity. To allow infection, replication, and persistence, (herpes)viruses employ ingenious strategies to evade host immunity. The human gamma-herpesvirus Epstein-Barr virus (EBV) is a large, enveloped DNA virus persistently carried by more than 90% of adults worldwide. It is the causative agent of infectious mononucleosis and is associated with several malignant tumors. EBV activates TLRs, including TLR2, TLR3, and TLR9. Interestingly, both the expression of and signaling by TLRs is attenuated during productive EBV infection. Ubiquitination plays an important role in regulating TLR signaling and is controlled by ubiquitin ligases and deubiquitinases (DUBs). The EBV genome encodes three proteins reported to exert in vitro deubiquitinase activity. Using active site-directed probes, we show that one of these putative DUBs, the conserved herpesvirus large tegument protein BPLF1, acts as a functional DUB in EBV-producing B cells. The BPLF1 enzyme is expressed during the late phase of lytic EBV infection and is incorporated into viral particles. The N-terminal part of the large BPLF1 protein contains the catalytic site for DUB activity and suppresses TLR-mediated activation of NF-κB at, or downstream of, the TRAF6 signaling intermediate. A catalytically inactive mutant of this EBV protein did not reduce NF-κB activation, indicating that DUB activity is essential for attenuating TLR signal transduction. Our combined results show that EBV employs deubiquitination of signaling intermediates in the TLR cascade as a mechanism to counteract innate anti-viral immunity of infected hosts.

Chp8, a diguanylate cyclase from Pseudomonas syringae pv tomato DC3000 suppresses the PAMP flagellin, increases EPS and promotes plant immune evasion.

The bacterial plant pathogen Pseudomonas syringae causes disease in a wide range of plants. The associated decrease in crop yields results in economic losses and threatens global food security. Competition exists between the plant immune system and the pathogen, the basic principles of which can be applied to animal infection pathways. P. syringae uses a type III secretion system (T3SS) to deliver virulence factors into the plant that promote survival of the bacterium. The P. syringae T3SS is a product of the hypersensitive response and pathogenicity (hrp) and hypersensitive response and conserved (hrc) gene cluster, which is strictly controlled by the codependent enhancer-binding proteins HrpR and HrpS. Through a combination of bacterial gene regulation and phenotypic studies, plant infection assays, and plant hormone quantifications, we now report that Chp8 (i) is embedded in the Hrp regulon and expressed in response to plant signals and HrpRS, (ii) is a functional diguanylate cyclase, (iii) decreases the expression of the major pathogen-associated molecular pattern (PAMP) flagellin and increases extracellular polysaccharides (EPS), and (iv) impacts the salicylic acid/jasmonic acid hormonal immune response and disease progression. We propose that Chp8 expression dampens PAMP-triggered immunity during early plant infection.

Effects of a green tax reform in Portugal: a general equilibrium analysis

Do ponto de vista da política económica, existe a possibilidade de utilizar a receita dos impostos ambientais para baixar os impostos sobre o trabalho, promovendo assim o emprego. Esta oportunidade surge na literatura como forma dos países industrializados responderem a um duplo desafio: um crescente nível de poluição e um decrescente nível de emprego. Alguns países tomaram já decisões no sentido de alcançar o “duplo dividendo”: melhorias ambientais e diminuição do desemprego. Os resultados teóricos, na sua maioria cépticos em relação à verificação do segundo dividendo, são substancialmente contrariados por uma série de estudos que utilizam modelos de equilíbrio geral. Pretendese com este trabalho fazer uma simulação para a economia portuguesa de uma reforma fiscal ambiental com as características referidas e a verificação da existência do “duplo dividendo”, através de um modelo computacional de equilíbrio geral. Para além disso, é feita uma análise dos impactos do Mercado Europeu de Licenças de Emissão, ao nível sectorial e regional, em Portugal, utilizando dados microeconómicos, com o objectivo de estudar as consequências ao nível das trasacções entre sectores e efeitos distributivos entre regiões.

Taxation and Household Financial Decisions: Evidence from the Bush Tax Acts

Thesis (Ph.D.)--University of Washington, 2013

How does globalization affect the tax burden on labour income, capital income and consumption in different welfare regimes? The case of Western and Eastern EU Member States

This article analyzes the effects of globalization on implicit tax rates (ITRs) on labor income, capital income, and consumption in the EU15 and Central and Eastern European New Member States (CEE NMS). We find supportive evidence for an increase in the ITR on labor income in the EU15, but no effect on the ITR on capital income. There is evidence of convergence in terms of the ITR on consumption, as countries with higher than average ITR on consumption respond to globalization by decreasing their tax rates. There are important differences among the welfare regimes within the EU15. Social-democratic countries have decreased the tax burden on capital, but increased that on labor due to globalization. Globalization exerts a pressure to increase taxes on labor income in the conservative and liberal regimes as well. Taxes on consumption decrease in response to globalization in the conservative and social-democratic regimes. In the CEE NMS, there is no effect of globalization on the ITR on labor and capital income, but we find a negative impact on the ITR on consumption in the CEE NMS with higher than average ITR on consumption. (JEL H23, H24, H25, F19, F21)

Tax policy stance over the business cycle: evidence from Europe

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Economics from the NOVA – School of Business and Economics

Empirical evidence on the difference between the effective and the statutory tax rates for listed groups in Germany

The difference between the statutory and effective tax rate for listed groups is a complex variable influenced by a variety of factors. This paper aims to analyze whether this difference exists for listed groups in the German market and tests which factors have an impact on it. Thus the sample consists of 130 corporations listed in the three major German stock indices. The findings suggest that the companies that pay less than the statutory rate clearly outweigh the ones that pay more, and that the income earned from associated companies has a significant impact on this difference.

Reporting Income Taxes in the Banking Sector In Angola - Accounting, Tax Regulation and Financial Reporting Evidences

This research provides an insight into income taxes reporting in Angola, based on hand collected data from the annual reports of banks. Empirical studies on Angolan companies are scarce, in part due to the limited access to data. The results show that income taxes’ reporting has improved over the years 2010-2013, becoming more reliable and understandable. The Angolan Government is boosting the economic growth through tax benefits in the investment in public debt, which cause a reduction in the banks’ effective tax rate. The new income tax law will reduce the statutory tax rate from 2015 onwards and change the taxable income, resulting in shifting the focus to promoting private investment.

Progressivity in the Portuguese personal income tax system

This Work Project analyzes the evolution of the Portuguese personal income tax system’s progressivity over the period of 2005 through 2013. It presents the first computation of cardinal progressivity measures using administrative tax data for Portugal. We compute several progressivity indices and find that progressivity has had very modest variations from 2005 to 2012, whilst from 2012 to 2013 there has been a relatively stronger decrease, excluding the impact of the income tax surcharge of the years 2012 and 2013. When this latter is included, progressivity of 2012 and 2013 decreases considerably. Analyzing the effective average tax rates of the top income percentiles in the income scale, we find that these rates have increased over the period 2010–2013, suggesting that an analysis of effective tax rates is insufficient to assess progressivity in the whole tax scheme.

Clarification of the Meaning of "Beneficial Owner" in the OECD Model Tax Convention: Comment on the April 2011 Discussion Draft

In April 2011, the OECD released an important discussion draft that is intended to clarify the meaning of the term "beneficial ownership" under articles 10, 11 and 12 of the OECD Model (2010). This article discusses these proposals and demonstrates that some refinement is necessary.