Taxation is the cornerstone of intergovernmental scal relations and is especially at stake when authorities address mobile tax bases. The EU case is particularly interesting to tackle. Evidences prove the existence of important tax interactions among member states and both theoretical and empirical analysis shed light on the di¤erent mechanisms at work. Likewise, the improved knowledge relative to tax avoidance strengthens the need to take into account this kind of phenomenom. In this paper we propose to compare various alternative settings to the current system so as to be able to estimate the relevance of granting EU the power to tax and in which way. In order to adopt a general and comprehensive framework, we introduce information asymmetries and examine di¤erent kinds of governmentsobjective function. We show that the best outcome would be reach if the EU tier only were allocated the power to tax rmspro ts but also prove that, in a context of national governments acting in a competitive way aimed at attracting rms, conferring the EU layer the capacity to apply a tax on a base alreeady subject to member statestaxation could improve the current issue.
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