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llocation of resources internationally. Nevertheless, the fact that tax competition may lead to adoption of unfair practices and these practices to be extended by altering the basis for all fiscal systems, suggests the need for international tax cooperation, as all governments have an interest to protect their national tax income

So far, the response of states about the increased competition in fiscal matters was mainly defensive. In April 2006, a report of the Commission under the name 'Taxation in the European Union' , was submitted where it stated that lower tax rates adopted by some Member States were described as 'unfair competition in the field of taxation'. Another text called 'Towards Tax Coordination in the European Union: a package to tackle Harmful Tax Competition' contained the first draft of a Code of Conduct/Behavior on Business Taxation. In this text it was clearly stated that the adoption of relatively 'low' tax rates is labeled as 'harmful?. Lastly, its worth to say that the relatively 'high' rates did not characterized as harmful.

To a certain extent, the states may defend themselves effectively against international tax competition by adopting appropriate adjustments in national tax systems. This possibility creates the risk of a “race to the bottom” by states to compete in a constant race to reduce tax rates which in long-run would jeopardize their tax revenue (Conconi et all, 2007)

The internationalization of business has created a highly complex environment for the private companies which are required to operate within a variety of different and sometimes conflicting laws and for the tax authorities which must with monitor the activity of the firms. In this context, the idea of ??establishing a uniform tax rate (Kulcsar et all, 2011), (Mintz, 2004) which would be imposed on total income of an enterprise, regardless of origin, undoubtedly offers the possibility of homogenization their tax treatment, while increasing transparency and fairness of the system in a international environment where the 'tax heavens' and 'unfair tax competition' are treated as major challenges for the existing tax system. More specifically international harmonization in corporate tax would have the following results:

The introduction introducing a common tax base for income business, which is based on a common definition of taxable income.

The harmonization of corporate tax rates which, although it is difficult to achieved completely would contributed significantly to the elimination of distortions associated with the “unfair” attractions of FDI

By establishing an 'international levy on businesses”, this is a solution which would combine the above in (i) and (ii) points, but without prejudice to the autonomy of the tax systems of individual states. The mandatory adoption of International Accounting Standards is an essential prerequisite for this step.

The cost of harmonization

The interaction between tax systems can be positive at the international level by promoting the market development. The attitude of the OECD is representative of the dominant world perception, which considers that the liberalization of markets and technological developments create new opportunities for economic growth and the fear that capital mobility will lead to a decrease of a tax base and an erosion of state revenues. However, the last 40 years tax