Skip to main content

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."

Filter by
Sorted by
Tagged with
22 votes
4 answers
9k views

Why is bartering uncommon in modern countries?

Recently, I witnessed two acquaintances of mine engaging in bartering, where one traded his services for the services of the other. Both services had about the same value. By trading them directly, ...
Bart's user avatar
  • 323
18 votes
2 answers
947 views

Why is capital income taxed differently than wage income?

Why is income from capital gains taxed differently than wage income? There are perhaps historical, practical, and theoretical reasons. What are they? (As far as historical reason go, I'm asking ...
jmbejara's user avatar
  • 9,355
16 votes
12 answers
6k views

Is money we make completely taken away by taxes?

In my opinion, any money we make will be completely taken away by taxes. Here is my logic. When I earn some money (x), I have to give some as tax to the government. ...
Tamila Ambeon's user avatar
16 votes
6 answers
4k views

Why aren't we seeing carbon taxes in practice?

(See also a version of this question under politics, https://politics.stackexchange.com/questions/48764/why-arent-we-seeing-carbon-taxes-in-practice) It seems that there are many advantages to carbon ...
present's user avatar
  • 305
14 votes
7 answers
2k views

Economic policies to decrease obesity (would they be effective?)

According to the Center for Disease Control and Prevention, approximately 35% of adults in the United States are obese. I have done much research on the topic of economic policies to reduce obesity (I ...
DornerA's user avatar
  • 1,568
13 votes
6 answers
919 views

Does land value tax create an incentive to merge land ownerships?

LVT is "a tax on the unimproved value of land", and "in theory, it does not distort decision making". But if I own land then improvements such as buildings on my neighbour's land can easily increase ...
bdsl's user avatar
  • 271
10 votes
2 answers
281 views

Optimality of Zero Capital Taxation

The Chamley-Judd result of zero optimal capital taxation says that 0 capital taxation are required in order to maximize welfare at the steady state. The result is 30 years old. Still assuming that ...
FooBar's user avatar
  • 10.7k
10 votes
1 answer
382 views

Straub and Werning, 2014, on zero capital taxation

This is a test balloon to see whether these kinds of questions are appreciated/welcome on Econ.SE: I had a hard time grasping Straub and Werning (2014) (no paywall). I understand the general ...
FooBar's user avatar
  • 10.7k
8 votes
7 answers
3k views

Why can't the Land-Value Tax (in some cases) be passed on to tenants?

According to https://en.wikipedia.org/wiki/Land_value_tax: Because the supply of land is essentially fixed, land rents depend on what tenants are prepared to pay, That doesn't make any sense. If ...
RonJohn's user avatar
  • 218
8 votes
4 answers
5k views

How is Singapore able to provide first-world public services, given its low income tax rate?

Singapore has a relatively low personal income tax rate. Somebody who earns $80,000 after deductions only pay 3,350 in taxes, or about 4% effective rate (see 2012-2016 tax table). 80,000 is already ...
user69715's user avatar
  • 214
8 votes
2 answers
258 views

Do welfare payments for children incentivise having children?

A common argument against safety net social welfare for people with children is that it can incentivise people without better options to have children. This could be considered a problem if it means ...
dwjohnston's user avatar
  • 2,036
7 votes
5 answers
438 views

How can consumption taxes be made progressive?

Consumption taxes (VAT, sales tax) are mostly applied at a flat rate. Some countries have exemptions or lower ratings for essential goods. But even with that, the tax is much less progressive than ...
paj28's user avatar
  • 938
7 votes
2 answers
348 views

Lee and Saez (2012): Pareto-Improvement?

I'm interested in the following quote that came up in this earlier answer. Second, when labor supply responses are along the extensive margin only, which is the empirically relevant case, the co-...
FooBar's user avatar
  • 10.7k
7 votes
1 answer
2k views

What are the pros and cons of eliminating corporate taxes?

I recently heard a story on npr about economic policy changes that both liberal and conservative economists definitively agree on. Among other things, complete elimination of corporate taxes was ...
Paul's user avatar
  • 171
7 votes
2 answers
961 views

Could a Cap-and-Trade and a Carbon Tax both work together as a system to reduce carbon emissions?

For example, the European Union currently has a Carbon Emissions Trading Scheme in progress the ETS which acts to cap the amount of carbon dioxide released by large corporations. However, let us ...
AlexLipp's user avatar
  • 173
7 votes
1 answer
108 views

Policy relevance of the optimal taxation given uncertainty about social welfare specification

One common criticism in the optimal taxation literature is the specification of the social welfare function. The optimal taxation literature (I have the Mirrlees framework in mind) relies on first ...
jmbejara's user avatar
  • 9,355
6 votes
3 answers
339 views

Why use marginal rather than average tax rates in incentive analysis?

Why do tax analysts worry about marginal tax rates, not average effective rates, in looking for incentive effects of taxes
Crysyal Mason's user avatar
6 votes
2 answers
2k views

Are sales taxes regressive?

There are competing definitions of regressive taxes out there: On Wikipedia: A regressive tax is a tax imposed in such a manner that the tax rate decreases as the amount subject to taxation ...
Shane's user avatar
  • 825
6 votes
3 answers
662 views

How does lowering a corporate tax rate benefit a nation?

When governments talk about about lowering corporate tax rates they claim there is benefit in one form or another. The problem is the mechanism of how the benefit can work is never explained. The ...
user1605665's user avatar
6 votes
2 answers
7k views

Effect of property tax on rent

Suppose the government puts a tax on all apartment owners (e.g. a certain percentage of the apartment value), whether or not the apartment is rented. Will this tax cause an increase in rent? From an ...
Erel Segal-Halevi's user avatar
6 votes
3 answers
519 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 ...
Three Diag's user avatar
6 votes
1 answer
55 views

What is was the total corporate Income earned in the United States in 2014?

What is was the total corporate income earned in the United States in 2014? The question may seem simple, but I have been looking for a reliable source to inform me of this figure, and I hope someone ...
Danny Alexander's user avatar
5 votes
4 answers
319 views

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. ...
lmenus's user avatar
  • 153
5 votes
4 answers
20k views

Taxes levied on sellers = Taxes levied on buyers

All page numbers refer to Principles of Microeconomics, 7 Ed, 2014, by NG Mankiw. [p 125:] Taxes levied on sellers and taxes levied on buyers are equivalent. [p 156:] ... When a tax is levied on ...
user avatar
5 votes
3 answers
20k views

What is the difference between VAT and corporate tax

Many times I hear that VAT (value added tax) is a "good" tax, while corporate tax is a "bad" tax/ However, both taxes take a cut from the difference between the income of a company and its expenses, ...
eyal's user avatar
  • 51
5 votes
3 answers
613 views

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 ...
Keavon's user avatar
  • 151
5 votes
3 answers
3k views

How are shell companies used for tax evasion?

The recent release of leaked documents on Mossack Fonseca has information on corporations and individuals using the firm's services for, among other things, tax evasion: The massive security breach ...
isanae's user avatar
  • 152
5 votes
0 answers
271 views

Arguments against inheritance tax

One of the arguments against inheritance tax is that it lowers the incentive to work for those close to retirement who have earnt enough money to be comfortable in old age. How much is this offset ...
christopherlovell's user avatar
4 votes
3 answers
5k views

Is my logic on taxation for this question legit?

At Fenway Park, home of the Boston Red Sox, seating is limited to 39,000. Hence, the number of tickets issued is fixed at that figure. Seeing a golden opportunity to raise revenue, the City of Boston ...
Ken's user avatar
  • 53
4 votes
1 answer
706 views

Are spectrum auctions a tax?

According to Wikipedia, A spectrum auction is a process whereby a government uses an auction system to sell the rights to transmit signals over specific bands of the electromagnetic spectrum and to ...
Ray Bradbury's user avatar
4 votes
2 answers
151 views

Externality and Output

In a positive externality, can government just set the price to the socially efficient price instead of a subsidy to correct an externality?
user avatar
4 votes
4 answers
327 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 ...
arrowturnips's user avatar
4 votes
2 answers
261 views

Who really pays transaction taxes like VAT or sales tax?

In Europe, shop prices are typically displayed including VAT. This gives the impression that the seller is paying the VAT. They have to offer a competitive price, then a percentage of that is taken ...
paj28's user avatar
  • 938
4 votes
2 answers
534 views

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 ...
cigikath's user avatar
  • 151
4 votes
1 answer
87 views

Understanding an article in the BMJ about the sugar tax

The research paper Changes in soft drinks purchased by British households associated with the UK soft drinks industry levy: controlled interrupted time series analysis was examining the impact of the ...
Rushi's user avatar
  • 143
4 votes
3 answers
403 views

What would be the economic impact of the "fair tax" plan?

So I read about an interesting proposal about completely replacing income tax with a heavy national sales tax of about 30% (23% inclusive to compare to income tax). I was thinking about what the ...
AJB_1070179's user avatar
4 votes
1 answer
122 views

Are there economic policies that help countries fight corruption?

Are there particular taxes or subsidies or public goods that a country's economic authority could implement to help in the fight against corruption? While the rule of law seems to be the first order ...
Fix.B.'s user avatar
  • 2,668
4 votes
1 answer
336 views

How to determine regressive tax

I have a mock-up exam that my teacher gave me and one of the questions was the following: Given these four graphs, which one represents regressive tax? I'm quite sure it's graph A, but I don't ...
Robin Haveneers's user avatar
4 votes
1 answer
74 views

What data / evidence is there to support the assertion that wealth taxes are ineffective because they're difficult to implement?

Whenever I see discussions of wealth taxes, inevitably one main assertion keeps being, well, asserted: "wealth tax will never work because it's too difficult to implement". Of course more ...
KubaFYI's user avatar
  • 141
4 votes
1 answer
454 views

Is an income tax always more favourable for consumers compared to ad valorem/quantity tax?

I'm studying the optimal choice of consumers with regards to taxation. I read that for consumers, income tax is generally (for Cobb-Douglas preferences) preferred compared to ad valorem tax: If the ...
j3141592653589793238's user avatar
4 votes
1 answer
91 views

Has any country attempted to inflation adjust capital gains before taxation?

Inspired by the answer to a different question I wondered: Can anyone think of a case study example, past or present, when capital gains are inflating adjusted before being taxed. I could imagine ...
Corvus's user avatar
  • 1,478
4 votes
1 answer
106 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 ...
gerrit's user avatar
  • 1,754
4 votes
2 answers
617 views

Is information technology going to turn most "common goods" into private goods?

Common goods, (not public) are so because they are non-excludable and rival. Often this reflects the impracticality of excluding some users, rather than an absolute impossibility. For example, a park ...
Fix.B.'s user avatar
  • 2,668
4 votes
1 answer
92 views

Do tax cuts to the rich lower interest rates?

The rationale for giving tax cuts to the income brackets is that this money is then invested in new businesses which increases jobs. If the saved money is being saved/invested instead of being spent,...
dwjohnston's user avatar
  • 2,036
4 votes
1 answer
3k views

Price Producers Receive as a Result of Indirect Taxes

In my economics class, we were introduced to the idea that if the government imposes an indirect tax on a good, the price consumers have to pay increases, but along with this increase in price for ...
GoodChessPlayer's user avatar
4 votes
1 answer
179 views

Difference-in-Differences on State Sales Tax Rates

In an attempt to evaluate a potential U.S. National Sales tax rate, it was suggested on this forum before that I consider a difference-in-differences on state sales tax rates before and after they ...
Howsikan's user avatar
  • 267
4 votes
1 answer
129 views

Simultaneous consumption tax and subsidy

Suppose the government introduces a simultaneous tax and subsidy on a consumption good, which is produced under perfect competition. If the tax and the subsidy are equal, then there will be no ...
BB King's user avatar
  • 6,188
4 votes
0 answers
30 views

How did "excess liquidity" in the US contribute to the 2008 crash?

Here I'm using "excess liquidity" not in reference to monetary policy, but to the concentration of capital at the top in regard to private citizens. This excess liquidity, for which the tax cuts in ...
DukeZhou's user avatar
  • 151
4 votes
3 answers
143 views

Is loss in tax revenue a negative externality?

I was thinking about how online gambling could cause numerous governments to face a reduction in tax revenue from conventional gambling, upon which taxes do apply in most countries. If governments ...
PETER SIAUW's user avatar
3 votes
5 answers
719 views

If Trickle Down Economics Works, Then Shouldn't "Trickle Up" Economics Work as Well?

A lot of controversy in economics on the political stage comes from trickle down economics and whether it even works or not. The idea is that if we give sufficient tax cuts to corporations, they'll ...
Badr B's user avatar
  • 149

1
2 3 4 5
7