




































AGORA International Journal of Economical Sciences, http://univagora.ro/jour/index.php/aijes 

ISSN 2067-3310, E-ISSN 2067-7669 

Vol. 19, No. 1 (2025), pp. 163-175 

 

163 

 

GLOBAL MINIMUM TAX AND THE DETERMINANTS OF 

CORPORATE TAX REVENUE: AN ECONOMETRIC ANALYSIS FOR 

THE WESTERN BALKAN COUNTRIES 

 

D. KILAJ, A. BEXHETI, S. ALIJA 

 

Duresa Kilaj1, Abdymenaf Bexheti2, Sadri Alija3 

¹ ² ³ Faculty of Business and Economics, South East European University - Tetovo, North 

Macedonia 

¹ https://orcid.org/0000-0002-6331-2234, E-mail: dk32331@seeu.edu.mk  

² https://orcid.org/0009-0003-9737-7647, E-mail: a.bexheti@seeu.edu.mk    

³ https://orcid.org/0000-0002-0355-731X, E-mail:  s.aliji@seeu.edu.mk  

 

Abstract: The purpose of this paper is to analyze the global minimum tax of 15% for 

international corporations, the fiscal impact of this policy which is already in force 

internationally as of January 1, 2025, as well as the determinants of corporate tax revenues, 

with a particular focus on the Western Balkan countries. The paper relies on secondary data 

collected from World Bank, the IMF, and Eurostat reports. Data processing is carried out 

using the STATA software, while the analyzed period covers the last 20 years. The empirical 

results show that foreign direct investment, GDP per capita, and trade openness have a 

positive impact on corporate tax revenues, while unemployment has a negative impact. 

Regarding the global minimum tax, it is seen that this tax has an effect in some countries but 

does not have a huge impact in some other countries. 

Keywords: Global minimum tax, corporate tax revenue, economic determinants, trade 

openness, foreign direct investments, GDP per capita. 

 

INTRODUCTION 

Corporate income tax is a crucial source of government revenue, especially in 

developing countries, where it accounts for 15-20% of tax revenues. However, there is a 

widespread perception that an increasing number of businesses, especially large ones, are 

paying less tax on their profits. This belief is supported by the ongoing decline in statutory 

tax rates and the growing competition among states to offer tax incentives, such as tax 

credits, income exemptions, and lower rates, to attract investments. This paper analyzes the 

impact of these tax incentives on reducing effective tax rates and how this effect varies 

depending on firm size (Bachaset al., 2023). 

The global minimum tax ensures that corporate profits are taxed at a minimum 

effective rate of 15%, regardless of the jurisdiction in which they are recorded. If a company 

reports profit in a country with a lower tax rate, its home country imposes a top-up tax to 

meet the global minimum threshold. However, there are several important exceptions to this 

rule. First, the global minimum tax applies only to multinational corporations with worldwide 

revenues exceeding €750 million. Second, it is not designed to penalize legitimate business 

https://orcid.org/0000-0002-6331-2234
mailto:dk32331@seeu.edu.mk
https://orcid.org/0009-0003-9737-7647
mailto:a.bexheti@seeu.edu.mk
https://orcid.org/0000-0002-0355-731X
mailto:s.aliji@seeu.edu.mk


Duresa KILAJ, Abdymenaf BEXHETI, Sadri ALIJA 

 

164 

 

activities in low-tax jurisdictions, as demonstrated by the carve-out rule, which reduces the 

taxable profit base by considering a firm's tangible assets and labor costs. Third, the tax does 

not apply to countries where a corporation has only a minimal operational presence 

(Johannesen, 2022). 

The paper is divided into 5 sections. The first part includes the literature review, the 

second section includes the meta-analysis, the third section includes the scientific 

methodology and the details of the econometric model. The fourth section includes the 

statistical analysis and findings of the study, while the last section includes the conclusions 

and recommendations of this study. 

 

LITERATURE REVIEW 

The 137 member countries that have adopted the OECD framework for a global 

minimum tax of 15% have the option to either implement the OECD Model Pillar 2 Rules or 

comply with the adoption of these rules by other nations. The agreement establishes global 

anti-base erosion (GloBE) rules, ensuring that large multinational corporations with 

consolidated revenues above €750 million pay an effective minimum tax rate of 15% on 

"excess profits" generated in any jurisdiction where the effective tax rate falls below this 

threshold. In such cases, companies must pay the additional taxes either in their home country 

or in the low-tax jurisdiction. The primary goal of the global minimum tax is to decrease tax 

competition for investment capital and limit profit shifting by creating a standardized 

framework for corporate taxation globally (Schjelderup & Stahler, 2024). 

The global minimum corporate tax primarily aimed to prevent the “race to the 

bottom” and increase corporate income tax rates. This concept suggests that the erosion of the 

tax base encourages tax competition, which subsequently results in lower corporate income 

tax rates. Globalization has played a key role in this phenomenon, as financial structures, 

transfer pricing, and intellectual property licensing have made income more mobile. This 

trend is evident in empirical data: the average corporate income tax rate, weighted by GDP 

across 94 countries, dropped from 34.1% in 2005 to 25.4% in 2020, a decline of 8.7 

percentage points. Notably, in 2018, the U.S. recorded a significant decrease in the federal 

corporate income tax rate from 29.7% in 2017 to 26.4%, following a 14% reduction. This 

shift was greatly influenced by the U.S., which accounts for nearly 25% of the GDP among 

the 94 analyzed countries(Mintz & Tulkens, 1986).  

The goal of the global minimum corporate tax is to mitigate the negative effects of tax 

base shifting. This is achieved by imposing a minimum tax on profits transferred to low-tax 

jurisdictions. As a result, this could lead to an increase in corporate tax revenues for tax 

havens in the Caribbean and low-tax countries like Ireland, which have experienced revenue 

losses (Mintz, 2022).  

According to the research, a global tax deal would look equitable in the long run, with 

individual countries either gaining or losing tax revenue. As a result, countries would have to 

adjust their budgets. The corporate tax rates in each country are shown in this chart along 

with the recommended floor of 15%. Countries that are currently in deficit and/or below the 

line will move quickly to enact regulations in order to become global tax collectors.  



GLOBAL MINIMUM TAX AND THE DETERMINANTS OF CORPORATE TAX REVENUE: 

AN ECONOMETRIC ANALYSIS FOR THE WESTERN BALKAN COUNTRIES 

 

165 

 

Similarly, countries with surpluses and effective tax rates above the threshold may be 

reluctant to adopt regulations designed to address this issue (Mrozek, 2023). 

 

Figure 1. Corporate tax rate in 2023 

 
Sources: (Mrozek, 2023) 

 

The objective of a global minimum tax is to change the nature of international tax 

competition. According to Devereux et al. (2021), the structure of the tax base for the 

surcharge has an impact on how the second pillar affects tax competition. Corporations in 

low-tax countries experience downward pressure on their corporate tax rate due to the 

methodology used to calculate the surcharge. Furthermore, because source nations can collect 

the surcharge themselves, they have a tremendous incentive to do so, see Perry (2023). It is 

argued that the Second Pillar is effective in creating a floor for tax competition in source 

countries (Devereuxet al., 2022). 

 

Table 1. Definitions of  Global Corporate Minimum Tax for Western Balkan Countries 

Definitions of Global Corporate Minimum Tax 

The Corporate Income Tax (CIT) system in Kosovo is based on the principle of worldwide taxation. 

Taxpayers subject to CIT are Corporations and other legal entities. Organizations and businesses 

operating with public/state assets. Non-resident persons with permanent residence in Kosovo. 

Resident taxpayers are generally subject to tax on both foreign and Kosovo-sourced income, while 

non-resident taxpayers are generally subject to tax only on their Kosovo-sourced income. The CIT 

rate is 10%. 

In Albania, non-resident individuals and entities are taxed only on income earned within the country. 

In contrast, resident entities are subject to taxation on all sources of income, both domestic and 

foreign. The corporate income tax (CIT) in Albania is set at a rate of 15%. Cit applies to taxable 

gains, which are determined by deducting deductible expenses from taxable income. 

Corporate income tax (CIT) is progressively imposed on businesses operating in Montenegro. The 

realized profit of taxpayers determines the applicable tax level, which varies from 9% to 15%. 

Residents are subject to profit taxes around the world. Montenegro origin or income attributed to a 

non-resident taxpayer of Montenegro is subject to taxation. Moreover, non-residents have to pay the 



Duresa KILAJ, Abdymenaf BEXHETI, Sadri ALIJA 

 

166 

 

retention tax for income earned in Montenegro. 

Serbia - Domestic and foreign income earned by residents is subject to tax. Only income derived from 

a permanent establishment within Serbian territory is subject to tax for non-residents, the corporate 

income tax (CIT) rate is 15%. 

In North Macedonia, CIT is generally due by all resident and non-resident legal companies that 

conduct business through permanent establishments. Entities that reside in Macedonia are subject to 

taxes on their international income. The profit realized by non-resident entities through its PE in 

North Macedonia is subject to taxation. 10% is the CIT rate. 

The two entities that makeup Bosnia and Herzegovina are the Federation of Bosnia and Herzegovina 

and the Republika Srpska. Both entities also govern a third territory, the Brčko District (BD). While 

indirect tax laws are implemented at the state level, direct taxes are imposed at the entity or district 

level. The Republika Srpska, the Brčko District, and the Federation of Bosnia and Herzegovina are all 

tax - resident corporations globally. Income earned in the regions of the Federation of Bosnia and 

Herzegovina, Republika Srpska, and Brčko District is subject to non-resident tax. 

Source: Collecting data from the author (2025) 

 

The corporate income tax (CIT) rate in Singapore stands at 17%, one of the lowest 

globally, and has played a key role in fostering a pro-business environment by supporting 

domestic firms and attracting foreign investment (World Bank, 2019). In contrast, Bhutan 

imposes a CIT rate of 30% on fully taxable firms and 25% on those with limited tax liability, 

which may hinder entrepreneurial growth. Consequently, the government could consider 

reviewing tax rates to encourage the establishment of new businesses and allow existing 

companies to retain a larger share of their profits. This would help increase retained earnings, 

supporting expansion, growth, or reinvestment in research and development (Shrivastava et 

al., 2024). 

According to the latest data, in 2023 there was an increase in tax revenues in the 

capital of Ukraine and in 18 other regions, compared to 2022. However, this growth was not 

evenly distributed across all regions, as only 13 of them showed improvement compared to 

the same period of the previous year. These findings are consistent with existing literature, 

which highlights the vulnerability of economic sectors to geopolitical and fiscal contexts, 

particularly in conflict-affected areas (Mazaraki et al., 2024). 

Transfer pricing practices used by multinational companies pose a significant 

challenge for national economies, especially in developing countries such as those in the 

Western Balkans. As highlighted in the study on the impact of transfer pricing on the 

Romanian economy, these practices can lead to substantial losses in fiscal revenues for the 

state budget, undermining fiscal capacity and the ability to finance public services. Therefore, 

governments need to strengthen the monitoring and regulation mechanisms of transfer 

pricing, in line with international best practices, aiming to strike a balance between 

encouraging foreign investment and preserving the integrity of the tax system. This 

underlines the need for a global minimum tax that ensures a fair and sustainable framework 

for taxing multinational corporations, addressing tax avoidance, and contributing to 

sustainable economic development in the region (Ivan & Ladar, 2017). 

 

Meta–analysis of research paper  



GLOBAL MINIMUM TAX AND THE DETERMINANTS OF CORPORATE TAX REVENUE: 

AN ECONOMETRIC ANALYSIS FOR THE WESTERN BALKAN COUNTRIES 

 

167 

 

In this part, a considerable number of scientific works analyzed by the following 

authors will be analyzed, which will be presented in tabular form and which deal with works 

with the same theme as our work. 

 

Table 2. Meta-analysis of research 

Author Year Title Methodology Finding 

(Mintz, 2022) 2022 The Global Corporate 

Minimum Tax: A 

Cure or Not? 

Panel data The results suggest that, to ensure that 

passive income is taxed, many 

countries could take action to tighten 

their foreign business control rules. It 

is unclear whether a minimum 

corporate tax worldwide would be 

more effective in reducing profit 

shifting than other focused initiatives, 

given the complexity of all these 

regulations. 

(Johannesen, 

2022) 

2022 The global minimum 

tax 

Meta analysis From the findings, we can say that the 

global minimum tax increases the 

welfare of individuals on the one hand, 

but also increases government revenue 

by preventing profit shifting. 

However, by raising tax rates and 

shifting resources away from 

businesses, this reduces their welfare. 

When profit shifting is paused in some 

form and the global minimum rate is 

high enough, there is an undeniable 

positive net welfare effect. 

(Mrozek, 2023) 2023 The Global Minimum 

Tax: Hurdles to 

Implementation of an 

Effective Tax 

Meta analysis According to the research findings, the 

OECD will not be able to implement 

its two -pole strategy by 2024 unless it 

is noted by all legislative bodies. 

Large multinational firms, 

governments around the world, the 

accounting sector, and the global 

economy in general should consider 

these results. The research shows that 

legislation can be approved and only 

succeed if the stakeholders cooperate 

to an extreme extent. 

(Schjelderup & 

Stahler, 2024) 

2023 The economics 

of the global 

minimum tax 

Meta analysis It follows that if SBIE is positive, a 

minimum 15% corporate tax for low-

tax subsidiaries is not met. We 

demonstrate that while Pillar 2 reduces 

tax motivated transfer prices, it 

changes employment, investments, 

and import incentives. Moreover, we 

show that SBIE is comparable to a 

production subsidy for a very high part 



Duresa KILAJ, Abdymenaf BEXHETI, Sadri ALIJA 

 

168 

 

of work and/or capital. 

(Haufler & 

Kato, 2024) 

2024 A Global Minimum 

Tax forLarge Firms 

Only: Implications 

for Tax Competition 

Meta analysis The results say it is not certain that tax 

discrimination always results in lower 

levels of taxes for small multinational 

corporations in a business 

environment. Including a response 

separated by multinational 

corporations to take advantage of 

lower tax levels for small MNEs 

would be the third and last extension. 

Source: Collecting data from the author (2025) 

 

SCIENTIFIC RESEARCH METHODOLOGY 

The aim of this paper is to analyze the global minimum tax of 15% for international 

corporations, focusing on the factors that influence corporate tax revenues, particularly in the 

Western Balkans. To carry out the research, will use secondary data provided by reliable 

sources from the World Bank, the International Monetary Fund, Eurostat, and others. Also, in 

the literature review part, we will focus on the works of different authors,together with 

relevant books by experts in the fields of finance, economics, and taxes. Also, we will focus 

on various international conferences, numerous reports and safe resources from the Internet. 

The study will use panel data covering 20 years (2004-2023) and the countries we will 

analyze are (Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia, Serbia, and 

Albania). For data processing, we will use the STATA software program. The importance of 

the paper lies in its aim to provide real and consistent results that can shed light on corporate 

taxes and economic growth. The variables included in this research are: dependent variable 

(CIT) and independent variables (Foreign direct investment, Gross domestic product per 

capita, Trade openness,and Unemployment). 

The data will be processed in the STATA program and to prove the validity of the hypotheses 

of this study, we will apply the following statistical tests: descriptive statistics, correlation 

analysis, linear regression, random effect, fixed effect, Hausman – Taylor regression and 

GMM. Arellano Bond Valuation Model, Generalized Valuation Equations (GEE Model). 

The hypothesis of the study is: 

H0: Economic determinants have a positive and significant impact on corporate tax revenues 

in the countries of the Western Balkans. 

H: Economic determinants don't have a positive and significant impact on corporate tax 

revenues in the countries of the Western Balkans. 

The research questions of the research are: 

1. What are the effects of the Global Minimum Tax on the economic determinants in 

these countries? 

2. Does the impact of the Global Minimum Tax differ between the different countries of 

the Western Balkans? 

3. What are the main economic factors affecting corporate tax revenues in Western 

Balkan countries? 

Table 3.  Description of the variables included in the econometric models 



GLOBAL MINIMUM TAX AND THE DETERMINANTS OF CORPORATE TAX REVENUE: 

AN ECONOMETRIC ANALYSIS FOR THE WESTERN BALKAN COUNTRIES 

 

169 

 

Source: Data obtained by authors (2025) 

 

The econometric model that will be used in this study is specified as follows: 

CTI = β0 + β1FDI + β2GDPC+ + β3TO + β4UNMP + γit 

Where: 

CTI – Corporate Tax Revenues 

FDI – Foreign direct investment 

GDPpercap – Gross domestic product per capita 

TO– Trade openness 

UNMP – Unemployment 

γ – stochastic variables (other factors not considered in the model) 

i – code and t – time period 

 

ECONOMETRIC ANALYSIS AND FINDINGS OF THE STUDY 

In the chapter, the results will be presented through econometric analysis, where in 

this part the hypotheses presented in the research will be tested and we will try to get answers 

to the research questions presented earlier. Initially, descriptive statistics, correlation, linear 

regression, fixed effect model, random effect model, Hausman Taylor Estimation, GEE 

Model, and GMM Model. All these results will be extracted through the STATA program. 

In the following table, descriptive statistics will be presented for the variables included in the 

research. We will analyze the number of observations, the average, the standard deviation, 

the minimum, and the maximum of these variables. 

 

Table 4.  Descriptive statistics for the variables included in the econometric model 

Variables Obs. Mean Std. Deviation Minimum Maximum 

FDI 120 3.65 3.570326 -15.2 13.4 

CIT 66 32.66515 5.961066 22.3 41.3 

GDPpercap 105 6.949524 5.149517 .1  37.3 

TO 120 91.9725 26.35181 0 168.8 

UNMP 100 19.949 7.190348 8.7 37.3 

Source: Author's calculations in Stata (2025) 

Variables Description of variables Data source 

Dependent variable (Y)  Corporate Tax Revenues (% GDP) Annual reports of the Bank 

World (2004-2023) 

 Independent variable (X1) Foreign direct investment (% of 

GDP)  

Annual reports of the Bank 

World (2004-2023) 

 Independent variable (X2)  Gross domestic product per capita 

(annual %)  

Annual reports of the Bank 

World (2004-2023) 

 Independent variable (X3) Trade openness (% GDP)  Annual reports of the Bank 

World (2004-2023) 

 Independent variable (X4) 

 

Unemployment (%)  Annual reports of the Bank 

World (2004-2023) 



Duresa KILAJ, Abdymenaf BEXHETI, Sadri ALIJA 

 

170 

 

Based on the data obtained from descriptive statistics, we can observe that the sample 

of our work is 120 observations, as for the average, we see that the variable with the highest 

average is TO. If we analyze the part of the standard deviation, we can notice that we have 

the highest value of the standard deviation in the TO variable as well, in the part of the 

minimum value is the CIT variable, and as for the maximum value, again the TO has the 

highest value. 

 

Figure 2. Graphic representation of the histogram 

 
Source: Authors' calculations in Stata (2025) 

 

Based on the graphical representation of the histogram, we see that between the 

dependent variable of GDP and the independent variable, there is a normal distribution of 

these variables included in the analysis. 

 

Table 5.  Correlation analysis for the variables included in the econometric model 

Variables CIT FDI GDPpercap TO UNMP 

CIT 1.0000     

FDI -0.2172 1.0000    

GDPpercap 0.1052 0.2679 1.0000   

TO 0.0197 -0.2007 0.1035 1.0000  

UNMP 0.0856 -0.3585   0.0495 -0.0260 1.0000 

Source: Authors' calculations in Stata (2025) 

The correlation table shows the relationships between the five main economic variables: CIT, 

FDI, GDPpercap, TO and UNMP. 

 

The correlation between CIT and FDI is -0.2172, suggesting a weak negative 

relationship between these two variables. This implies that an increase in corporate taxes is 

associated with a small decrease in foreign direct investment, although the relationship is 

weak.The correlation is 0.1052, indicating a very weak positive relationship between CIT and 

GDP per capita. This implies that an increase in GDP per capita is associated with a small 

increase in corporate taxes, but the relationship is negligible.The correlation is 0.0197, 

indicating an almost insignificant relationship between CIT and TO. This result suggests that 

0
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CIT



GLOBAL MINIMUM TAX AND THE DETERMINANTS OF CORPORATE TAX REVENUE: 

AN ECONOMETRIC ANALYSIS FOR THE WESTERN BALKAN COUNTRIES 

 

171 

 

there is no significant relationship between corporate taxes and the level of open trade.The 

correlation is 0.0856, indicating a weak positive relationship between CIT and the 

unemployment rate. This may mean that an increase in corporate taxes is associated with a 

small increase in unemployment, but this relationship is weak. 

The following is the analysis of statistical tests performed through the STATA 

program, such as linear regression, random effect, fixed effect, Hausman - Taylor Regression, 

GMM Model -Generalized Estimating Equations (GEE Model). 

GDP = β0-.5552252+ β1.3855899+ β2.0154152+ β3.7088763+ β45552252+ γit 

 

Table 6.  Econometric results and empirical findings of the study 

Variables Linear 

Regression 

Random Effects 

– GLS 

Regression 

Fixed – 

Effects 

Regression 

Hausman – 

Taylor 

Regression 

GEE 

Model 

GMM 

Model 

CIT - - - - - - 

FDI -.1617591 

(0.000)*** 

-.2958505 

(0.056)** 

-.5338307 

(0.008)** 

-.5328499 

(0.008)** 

-.5312379 

(0.008)** 

-.148731 

(0.373) 

GDPpercap -.2415487 

(0.249) 

.3855899 

(0.004)** 

.4978438 

(0.001)*** 

.4822447 

(0.002)** 

.4768369 

(0.002)** 

.5684211 

(0.000)*** 

TO   .0049486 

(0.475) 

.0154152 

(0.054)** 

.0222733 

(0.067)** 

.0185606 

(0.093)* 

.0184015 

(0.093)* 

  .0012802 

(0.931) 

UNMP .8297792 

(0.000)*** 

.7088763 

(0.044)** 

.0491625 

(0.141) 

.0415701 

(0.174) 

.0411805 

(0.175) 

.046002 

(0.230) 

Const. 1.023933 

(0.144) 

-.5552252 

(0.703) 

-.9106561 

(0.600) 

-1.399409 

(0.558) 

-.3690647 

(0.826) 

 

R Square 0.4737 0.4095   0.0428 -   

Adj.R2 0.4503 0.3448 0.0198 -   

Source: Authors' calculations in Stata (2025) 

Explanation: P-values are shown in brackets: *** indicates statistical significance at the 1% 

level; ** indicates statistical significance at the 5% level and * indicates 10% statistical 

significance. 

 

Based on the econometric results in the table above, we can conclude that some of the 

independent variables are significant at the 1%, 5%, and 10% levelsFor interpretation 

purposes, we will base our analysis on the Random Effects GLS model, where all results in 

this regression are significant.  

β0 - If all other factors are constant, then CIT will be -0.5552252units. 

β1 – If Foreign Direct Investment increases by one unit holding all other variables 

constant, then CIT will decrease by -0.2958505 units. This statement is correct since the 

values are within the 5% confidence interval, because (p-value = 0.056=0.05).Increased 

Foreign Direct Investment often leads to increased corporate tax revenues. This effect occurs 

because FDI increases economic activity and company profits. The increase in the number of 

companies and the improvement of the business environment stimulate more economic 

activity and other investments, contributing to a continued increase in corporate tax revenues. 



Duresa KILAJ, Abdymenaf BEXHETI, Sadri ALIJA 

 

172 

 

β2 – If GDP per cap increases by one unit keeping all other variables constant then 

CIT willincreaseby 0.3855899units. This statement is correct since the values are within the 

5% confidence interval, because (p-value = 0.004<0.05).An increase in Gross Domestic 

Product (GDP) per capita usually leads to an increase in corporate tax revenues. This is 

because a higher GDP per capita typically indicates increased economic activity and living 

standards, which boosts demand for products and services, and consequently, corporate 

profits.Better economic conditions, along with increased private consumption and 

investment, contribute to heightened business activity and boosted corporate tax revenues.  

β3 – If the trade openness increases by one unit, keeping all other variables constant, 

then CIT will increase by 0.0154152units. This statement is correct since the significance 

value is within the 5% confidence interval, because (p-value = 0.054=0.05).Increased trade 

openness, which includes increased imports and exports, can boost economic activity and 

create new opportunities for companies. This often leads to increased profits for businesses 

that benefit from expanded markets and increased sales volumes. Furthermore, increased 

trade openness can stimulate additional investment and create a more favorable business 

environment, helping to increase tax revenues. 

β4 - If Unemployment increases by one unit keeping all other variables constant then 

CIT will increaseby 0.7088763units. This statement is correct since the significance value is 

within the 5%confidence interval, because (p-value = 0.044<0.05). Rising unemployment 

typically leads to a decrease in consumption and demand for products and services, 

negatively impacting company profits. With less income and a weaker economic 

environment, companies may cut back on investment and hiring, further reducing corporate 

tax revenues. Additionally, increasing unemployment can deteriorate the business 

environment and impact economic sustainability, leading to a potential decline in corporate 

tax revenues. 

 

Table 7. Heteroscedasticity test 

Breusch-Pagan / Cook-Weisberg test for heteroskedasticity 

  H0: Constant variance 

  Variables: fitted values of CIT 

 

Chi2 (1)         =                 1.40 

Prob > chi2      =               0.2365      

Source: Authors' calculations in the Stata program (2025) 

 

Breusch-Pagan/Cook-Weisberg test results indicate that there is insufficient evidence 

to suggest heteroskedasticity in the regression model. With a p-value of 0.2365, which is 

greater than the significance level of 0.05, the hypothesis of constant variance 

(homoscedasticity) is not rejected. This indicates that the errors in the model have a constant 

variance and it is not necessary to make adjustments for heteroscedasticity. 

 

 

Table 8. Tests of normality 



GLOBAL MINIMUM TAX AND THE DETERMINANTS OF CORPORATE TAX REVENUE: 

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Skewness/Kurtosis tests for Normality 

Variable ObsPr (Skewness)   Pr (Kurtosis)       adj chi2 (2)           

Prob>chi2 

resid 65     0.8880      0.0000           15.21         0.0005 

 

Source: Authors' calculations in the Stata program (2025) 

 

Skewness: The high p-value (0.8880) suggests that there is no problem with skewness of the 

residuals. 

Kurtosis: A very low p-value (0.0000) suggests that there is a significant deviation from the 

normal distribution in terms of kurtosis. 

Joint Test: The p-value of the joint test (0.0005) shows that, in general, the residuals do not 

follow a normal distribution, suggesting that the model may have problems with the 

assumption of normality of the errors. 

Overall, this result indicates that the distribution of the residuals is not normal, mainly due to 

a problem with kurtosis. 

 

Table 9. VIF test 

Variable  VIF 1/VIF 

GDPPERCAP 1.37 0.731420 

UNMP 1.20 0.832592 

FDI 1.15 0.872143 

TRD 1.09 0.915363 

Mean VIF 1.20  

Source: Authors' calculations in the Stata program (2025) 

 

The test results (VIF) show that there is no significant collinearity problem between 

the independent variables in your model. All VIF values are below 10, with an average of 

1.20, suggesting that the independent variables are stable and not affected by collinearity. 

This shows that your model is reliable and the regression coefficients are stable. 

 

DISCUSSIONS/CONCLUSIONS 

The purpose of this research was to analyze the global minimum tax of 15% for 

international corporations and to examine the determinants of corporate tax revenues, 

specifically focusing on the Western Balkan countries. We successfully analyzed several 

factors and developed an econometric model, which yielded some significant results.  

Analysis of the results shows that foreign direct investment, GDP per capita, and trade 

openness positively influence corporate tax revenues. This conclusion is supported by the 

econometric models used in this research. The other independent variable, which is 

unemployment, turns out to hurt corporate tax revenues. From here we say that most of the 

analyzed countries have been good in this aspect, but some other analyzed countries still need 

to work on this issue.The Global Minimum Tax is a type of initiative led by the OECD/G20, 



Duresa KILAJ, Abdymenaf BEXHETI, Sadri ALIJA 

 

174 

 

which aims to establish an effective minimum tax of 15% for multinational corporations with 

revenues over 750 million euros. As we discussed in the paragraphs above, the purpose of 

this tax is to reduce tax avoidance and set a floor in tax competition between countries. 

Research shows that this tax is present in some Western Balkan countries, while 

others do not implement it.North Macedonia: The Republic of Macedonia adopted the law on 

the global minimum tax on corporate income in December 2024, implementing the 

OECD/G20 Pillar Two rules. The law entered into force on January 1, 2025. Montenegro: 

This country has not yet formally adopted the Pillar Two rules in its tax legislation. But 

importantly, this country has taken steps toward improving tax policies, including the 

introduction of transfer pricing rules and progressive taxation as of January 1, 2022(CMS, 

2023).Serbia: although it has not yet implemented the regulations on the global minimum tax, 

the corporate income tax rate is 15%, in line with the rate proposed by the OECD. However, 

it is believed that due to various tax incentives, the effective tax rate may be lower than 

15%(Karanovic, 2024).Kosovo, Bosnia and Herzegovina and Albania: so far these countries 

have not taken concrete steps towards implementing the global minimum tax. 

The concept of this tax may still be new to many countries and involves a complex 

process that requires alignment with both domestic and international legislation. As a result, 

Western Balkan countries may be at varying stages of this process, and further developments 

are anticipated in the future. Examining other countries worldwide, which have been 

analyzed by different authors, reveals the presence of this tax in those regions as well. Given 

its importance, we say that this tax should be taken more seriously even by countries that do 

not yet implement it. 

During the implementation of this research, we also encountered several limitations 

that sometimes made the work difficult. A major limitation was the lack of information 

regarding the global minimum tax for the Western Balkan countries, there was no literature 

review for these countries since it was an unexplored topic, and we encountered a lack of data 

for some variables. We hope that in the coming years, this gap in the literature review section 

will be filled with sufficient information. 

 

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