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Questions tagged [taxation]

Refers to compulsory or coercive money collection by a levying authority, usually a government. The term "taxation" applies to all types of involuntary levies, from income to capital gains to estate taxes. Though taxation can be a noun or verb, it is usually referred to as an act; the resulting revenue is usually called "taxes."

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What are the growth rates projected in the pending US Tax bill? (2017)

I haven't had time to get very granular on the pending US tax reform bill, but during the debates and drafting process, I was hearing some pretty big numbers being thrown around in terms of growth. (...
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What would be the effect on a tax on business cash flow instead of on income?

This came up in a pub discussion. (yes, it was good beer...) Suppose that instead of taxing companies on the net income they make, they were taxed at a much lower rate on cash flow, with no ...
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By which mechanism was the Isle of Man used for fiscal optimization?

The Isle of Man is one of the territories that appears in the "Paradise Papers" scandal. Articles say that the island's situation makes it very convenient for rich people that are trying to dodge tax. ...
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How effective is progressive tax at regulating monopoly?

Regardless of the morality of progressive taxes, the economical benefit of progressive tax is at least debatable. But could a highly progressive tax replace at least some of the american/european anti-...
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What are the rationales for corporate taxation? [duplicate]

What would be the reasons to tax companies? I want to exclude pigovian taxes from theses reasons. Basically, one underlying idea would be: in some models, firms are almost considered irrelevant, as ...
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Are there any economic reasons that could justify a higher tax rate on housing repairs than on construction of new houses?

In the UK, a builder constructing a new home need not add tax to the price charged, but a builder undertaking repairs or renovations to an existing home must add value added tax (VAT, currently 20%). ...
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Is printing money to pay government expenses regressive or progressive taxation?

Lets say that the government decides to pay some of its expenses by printing money*. This (according to some schools of thought) effectively increases the inflation rate and devalues the value of the ...
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51 views

Could a tax on rental income that depends on price per square meter induce more housing with lower rents?

The background of this question is: In Germany rental income is generally taxed the same as regular business income. In some cities, there seem to be housing shortages across different incomes. Are ...
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Which income dollar is taxed most heavily, including implicit taxation, in USA?

Income is often taxed implicitly by disqualifying deduction or government assistance. For example, if the recent proposal of "free tuition for kids of families making under \$125k" would pass the \$...
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Why do we use tax brackets?

Majority of countries (if not all) use tax brackets to define how much tax should the earning workforce pay. So we could have something like this. ...
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132 views

Tax by inflation

I am interested in a system where the state prints new money to cover all its expenses. (There is no direct tax collection.) I'm interested in anything you might have to say about this system, but to ...
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Why does everything get more expensive as cities grow in density/size?

I have long wondered why groceries, rent, and especially cially taxes increase as cities get larger since the cost per capita goes down, at least according to everything I've read including a summary ...
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Why do we model that higher government involvement increases output?

I have just read about the "real intertemporal" model of a macroeconomy in Macroeconomics by Stephen Williamson. I am concerned about how it says any increase in government spending, even if it is ...
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UK: Is there a list published by the government for the amount of tax paid by companies?

I know of the website for data.gov which provides data but is a publicly available list of taxes paid by publicly own corporations like Apple? If not how do we know how much is paid by them?
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Microeconomic Q on Total Revenue for Producer after Excise Tax [closed]

I had a question on how an excise tax per unit of good produced for a producer would affect total revenue for a producer of that good. The graph is that supply is perfectly elastic (horizontal) and ...
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The introduction of Single Transaction Tax would help to curb out Tax Evasion & Black Money?

The Arthakranti (a NGO working on Economic Reform in India) suggests the proposal of Tax Reform. In the proposal they suggest that All Taxes and Duties of Central ,State and Local body Government ...
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Falling oil prices but no benefits passed on to the end user; government's strategy

Even though the oil prices have fallen rapidly in the recent years, the cost of petroleum products hasn't gone down in India. Apart from raising more revenue, what are the other benefits the ...
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Why can't direct taxes be passed on to the consumer? [duplicate]

What stops firms increasing prices of goods in the case of an increase of a direct tax such as corporation tax?
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1answer
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:History: Industry threatening to leave if social change takes effect

With growing inequalities and salary gap, left-wing politicians are asking for social reforms in some countries (I am thinking of France). Social reform include: equal pay for women, maternity leave,...
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Is there an intuitive explanation for the tax incidence formula from elasticity?

You're probably familiar with the formula for tax incidence (in a standard Principles framework) from elasticity. Specifically, that the consumer share is $$\frac{\varepsilon_S}{\varepsilon_S+|\...
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3answers
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Why is corporation tax regarded as a direct tax?

I understand that the classification of taxes is on ability-to-pay principle and is partly determined by the demand elasticity of the commodity or service. That's how I understand income tax is ...
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How can a country ensure its national currency is used by its citizens?

I am wondering how countries are able to force everyone to use its own currency, instead of some external currency (like the U.S. dollar or Bitcoin or cookies or something else not under government ...
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2answers
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Could the upper quintile pay the annual federal personal income tax for all other quintiles from their annual income?

I am wondering if, in theory, the upper quintile (20% of earners in the U.S.) could pay the annual federal tax bill for all quintiles from their annual income? I have been looking at 2013 CBO data ...
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Fraction of labour force providing income redistribution services

What % of the labour force for an OECD country like the UK (mostly civil service I'm guessing) deals primarily with income redistribution, rather than income generation? Would a simple flat income tax ...
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Monopoly and Taxes (Nicholson Exercise)

Hello I'm working through Microeconomic Theory : Basic Principles and Extensions of Nicholson and Snyder 10e, for an exam and I fail to get how to answer this question (p.517) : A specific tax is a ...
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What is the actual amount of money lost to corporate tax evasion and avoidance in the UK? [closed]

I find this topic confusing, because there are so many figures out there from seemingly credible sources. You hear politicians using figures to either attack current policy or defend it. Many people ...
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Can you tax profit at the consumer?

Is it technologically feasible for companies who sell to more than one country to split its consumers by resident status and then pay the tax on the profit from the sales to the respective governments?...
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The effect of structural unemployment on revenue from value added tax

Bill Gates and European countries have shown favor for consumption/VAT taxes. The arguments given by proponents are often something along the lines that "we know how to tax certain items more than ...
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1answer
60 views

Economic effects of a Commons Capital Depository

Yanis Varoufakis (Ιωάννης Βαρουφάκης) proposes to fund a universal basic income (UBI) using dividends from a commons capital depository, essentially channeling a percentage of shares issued at an ...
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2answers
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Are there any drawbacks to a hypothetical climate policy?- Carbon tax for reducing Income tax

Disclaimer: I do not have a formal education in economics Here is the idea of my hypothetical policy: graduated over a period, say about 10 years or longer, the income tax is phased out and a carbon ...
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1answer
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Is Canada a country of high taxation in international comparison?

Looking through Canada's culture section on wikipedia, it's described as having: Government policies such as publicly funded health care, higher taxation to redistribute wealth, the outlawing of ...
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How to tax the robots?

The Socialist candidate for the upcoming presidential elections Benoit Hamon says he wants to roll out the Universal Basic Income in France, to be paid by "taxing the wealth created by robots" (for ...
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2answers
304 views

Does lowering corporate tax rates increase investment or provide some other benefit to a nation? [duplicate]

In Australia at the moment there is a move to lower the top corporate tax rate from 30% to 25% or thereabouts. The reasoning is that the benefits from investment will outweigh the cost to the budget. ...
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How can we estimate the tax incidence from a 20% tariff on Mexican goods?

President Trump has proposed a 20% tariff on some Mexican imports to the US. Is there a good way to estimate the incidence of this proposal between the Mexican producers and American consumers, as ...
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VAT changes in India

While I know that VAT was introduced in the form of modvat in 2005 and then modified to cenvat but does anybody the rates and the change over the years. IIRC, it started with 1 percent in 2005 and now ...
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1answer
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Is corporate tax an argument in equal income tax (from labour and capital) debate and does the return on capital depend on rate of the corporate tax?

In our country we have 25% personal income tax on labour, 15% corporate tax on corporations and 10% personal income tax on income from capital (e.g. dividends). Pundits in our country are saying that ...
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Inelastic offer, tax paid by seller, who supports the charges

I have a small problem, I have a situation where we have a perfectly inelastic offer and a normal demand, then there is a tax that is paid by the supplier who supports the totality of the charges ? Is ...
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Why is the purchase of assets not entirely tax-exempt in the year of purchase?

I'm a sole proprietor who has bought some assets for my business, like a chair. My accountant told me that I can't claim the entire price as a business expense in the year I incurred it, and instead ...
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334 views

What are the arguments against a zero corporate tax? [duplicate]

I've read a title in the news proposing a zero corporate tax. Thinking about it I couldn't figure a good reason against. Why couldn't a country just set the corporate tax rate for firms to zero and ...
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What are the mathematical constants used in economy formulas?

For the calculation of the taxes, the rate is the coefficient of proportionality. This coefficient is constant because It is the value of the ratio between a quantity and another that is constantly ...
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Marginal tax rate question [closed]

In relation to an ordinary employee, the Prime Minister of Australia pays? a) the same marginal tax rate b) a higher marginal tax ate c) a lower marginal tax rate My answer for this ...
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When a tax is imposed on the sellers, the price of the good rises. So, why doesn't the demand curve shift?

A tax imposed by the government on the sellers would drive up the price of the good. I understand that the supply curve will shift upwards due to this but the won't the demand curve also shift ...
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The United States' position on the Laffer Curve

According to a 2012 IGM panel (cf. reference below), most experts believe that a federal income tax cut would lead to a higher GDP in five years, ceteris paribus. Is this effect purely Keynesian, and ...
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“Wealth tax” on illiquid assets, how would people pay

In the idea of a wealth tax, or even for properties taxes, many times assets are illiquid. What mechanisms can be introduced to promote compliance and ensure the revenue collection goals of the taxing ...
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Supply/Demand Curve for Excise tax that's being passed 100% on to consumers

I'm doing a paper on the 'coca-cola tax' the tax on all sugary drinks. The premise is that it is an excise tax, which will then be passed 100% on to consumers. What I'm struggling with is how the ...
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Do across-the-board tax breaks increase wealth if wealth is relative?

So, as I understand it, the value of one's money is in its purchasing power, and its purchasing power is related to its amount relative to others. That is to say: Earning 25k a year in a country ...
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Hypothetical question: Percentage change in Federal income tax revenue in United States if Gini Index = 0?

Gini index = 0 refers to an economy where gross income has been redistributed so that all income earners in the United States received the same income, equal to the most current measure of the mean (...
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3answers
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Total UK Household Income

How would I calculate the total UK household income? I want to be able to estimate what a flat 10% income tax would generate (with no personal allowance or other tax breaks). Not that I agree with ...
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1answer
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Effect of government debt on tax rates?

Is there any well known study that links government debt to tax rates? I have been searching the literature for some time now and haven't found any. More importantly, could government debt track tax ...
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Self policing incentive in GST

Amongst several advantages of GST(Goods and Services Tax) I read one as that it prevents tax evasion through self policing incentive.But self policing incentive is already provided in VAT.So what's ...