ABSTRACT
In the introduction to his recent book Taxation in an Integrating World (1995)2 Vito Tanzi raises important questions concerning tax policies in the world economic system. He states:
In a world that continues to be organized into nations and in which tax systems are national in scope and there is no international tax authority, what will be the implication of the internationalization of economic activities for those tax systems? How will countries react to crossborder spillovers, to their diminished national authority, and to the challenges to their political sovereignty that deep integration will bring? Will countries recognize the benefits of collaboration or will they try to go it alone? In which areas and for which countries will collaboration be a preferred response? Where will competition be chosen? What will be the consequences of choosing one strategy over the other?
