Tax Competition and Fiscal Aid in Brazil: a Comparison with State Aid Regime

Tax competition at the level of the Federal States is an issue of great concern in Brazil to the extent that there is no effective control nor an efficient framework of rules as the European Community has and imposes to its Members States. On the other hand, tax competition could be used so as to promote and develop certain Brazilian areas/ sectors which lack economic and financial support. This work is a comparative study which highlights the harmful effects of tax competition in Brazil and offers as a solution the adoption of an specific regulation inspired in the state aid regime implemented by the European Community.