o:2404 ENHANCING COMPETITIVENESS OF NATIONAL ECONOMIES AND ENTERPRISES en Tax competition, or a strategic game between countries, is definitely a phenomenon that attracts undivided attention of academic circles for many years. However, the globalization of economy over the past few decades has made this phenomenon even more attractive for studying. Particular attention is paid to these problems in underdeveloped and transition economies, primarily because of its effects on the macroeconomic aggregates of these countries.The consequences of tax competition are the transfer of capital and labor from jurisdictions with high tax burden to jurisdictions with lower tax burden. Namely, tax competition should create conditions for attracting capital and investments, through a favorable tax framework. That is why, in most studies, the starting point is the idea that tax competition is a competition among states in attracting capital. Although the largest number of tax impact analysis on the decision to allocate the activities of companies per country is focused on corporate income tax, this study deals in detail with the effects of tax system competitiveness in the domain of corporate income tax. This study deals with the analysis of the countries of the European Union with a reference to Serbia. Cluster analysis was conducted and groups of analyzed countries with similar characteristics were defined. The results of the cluster analysis showed that countries with the highest index of competitiveness have the lowest unemployment rates and the highest share of GDP in world GDP. The effects of tax competition on the corporate income tax rate of the company were analyzed and it was concluded that tax competition contributes to the tendency of lowering the rates of this tax form. Thematic collection of paper: „Enhancing Competitiveness of National Economies and Enterprises“: pp. 21-41., Faculty of Economics University of Niš tax, effect, competition, income 1552100 978‐86‐6139‐183‐5 2024-03-10T12:53:57.366Z 44 yes 46 Jadranka Đurović- Todorović Faculty of Economics, University of Niš 2019 46 Milica Ristić Faculty of Economics, University of Niš 46 Marina Đorđević Faculty of Economics, University of Niš application/pdf 3254195 https://phaidrani.ni.ac.rs/o:2404 no yes 18 70 1556235 18A15