Chapter 4: Taxing Mobile Jobs and People

After reviewing corporate taxation, this chapter takes a closer look at the taxation of jobs and people in a mobile world. Increased mobility of jobs and workers is an important factor for the design of tax­financed welfare systems, and the benefits and costs of globalization must be distributed fairly. The principles regulating the internal market and social security limit the EU’s scope for shaping the welfare state when people migrate within the European Union. On the other hand, there is greater leeway with regard to the migration of non­EU citizens. Policy measures affect both the revenue and the expenditure side. Developments in recent decades show that differences in welfare state regulations persist and that some of the most efficient economies include some countries with lean welfare states and some with extended welfare states. This is an indication that the scope of national policies with respect to the design of welfare systems is largely intact.