nep-acc New Economics Papers
on Accounting and Auditing
Issue of 2012‒05‒08
five papers chosen by
Alexander Harin
Modern University for the Humanities

  1. Taxing Home Ownership: Distributional Effects of Including Net Imputed Rent in Taxable Income By Figari, Francesco; Paulus, Alari; Sutherland, Holly; Tsakloglou, Panos; Verbist, Gerlinde; Zantomio, Francesca
  2. Working Paper 01-12 - L’élasticité de l’impôt des personnes physiques - Approche macroéconomique prospective de l’élasticité nationale et de l’élasticité de l’impôt régionalisé By Vincent Frogneux; Michel Saintrain
  3. Maximum Carbon Taxes in the Short Run By Richard Tol
  4. Sales Taxes and Internet Commerce By Liran Einav; Dan Knoepfle; Jonathan D. Levin; Neel Sundaresan
  5. A Tariff-Tax Reform under Oligopoly and Free Entry By Kenji Fujiwara; Ryoma Kitamura

  1. By: Figari, Francesco (ISER, University of Essex); Paulus, Alari (ISER, University of Essex); Sutherland, Holly (ISER, University of Essex); Tsakloglou, Panos (Athens University of Economics and Business); Verbist, Gerlinde (University of Antwerp); Zantomio, Francesca (University of Essex)
    Abstract: Imputed rental income of homeowners is tax exempt in most countries, despite the long-standing arguments recommending its inclusion in the tax base, on both equity and efficiency grounds. The current fiscal crisis revived interest towards this form of taxation. The paper investigates the fiscal and distributional consequences of including homeowners' imputed rent, net of mortgage interest and maintenance costs, in taxable income as any cash income source that extends consumption opportunities. Three scenarios are analysed in six European countries: in the first imputed rent is included in the taxable income of homeowners, while at the same time existing mortgage interest tax relief schemes and taxation of cadastral incomes are abolished. In two further revenue-neutral scenarios, the additional tax revenue raised through the taxation of imputed rent is redistributed to taxpayers, either through a proportional rebate or a lump-sum tax credit. Results show how including net imputed rent in the tax base might affect inequality in each of the countries considered. Housing taxation appears to be a promising avenue for raising additional revenues, or lightening taxation of labour, with no inequality-increasing side-effects.
    Keywords: housing taxation, imputed rent, income distribution, inequality, microsimulation
    JEL: D31 H23 I31 I32
    Date: 2012–04
  2. By: Vincent Frogneux; Michel Saintrain
    Abstract: This Working Paper discusses the elasticity and the progressivity of personal income tax. Both concepts deal with the same object but from a different perspective: elasticity has a temporal angle, whereas progressivity has a cross-sectional angle. Progressivity is here estimated based on the distribution statistics of taxable income and taxes. In addition, a method is introduced to assess the negative relationship between progressivity and income growth. In retrospect, that relationship contributes to explain the evolution of progressivity during the past decades. Looking ahead, it can be used to project – under an unchanged policies assumption – an evolution of elasticity different from the constant elasticity hypothesis, typical of short- and medium-term models, and from the unitary elasticity hypothesis, typical of long-term models. In this context, the impact of the larger share of pensions in the tax base on progressivity is taken into account. This Working Paper also discusses the regionalization of personal income tax approved within the framework of the Institutional Agreement for the sixth Reform of the State of 2011. More specifically, it demonstrates how the treatment of elements from the tax system with a fixed dimension (zero tax bracket, tax relief) and elements with a progressive dimension (income scale) influences the specific elasticity of the regional and the federal tax shares in personal income tax.
    Keywords: Fiscal federalism, Personal income tax, Progressivity
    JEL: C82 H24 H77
    Date: 2012–03–15
  3. By: Richard Tol (Department of Economics, University of Sussex, Institute for Environmental Studies and Department of Spatial Economics, Vrije Universiteit, Amsterdam)
    Abstract: A cap is imposed on the carbon tax rate if the total tax revenue is not allowed to increase. Using recent data on the carbon-intensity of the economy and the overall tax take, I show that this cap constrains almost any climate policy in at least some countries. A larger number of countries, emitting a substantial share of global carbon dioxide, cannot fully participate if the carbon tax (or equivalent alternative regulation) is high enough to meet the 2ºC target. For that target, the carbon tax revenue in 2020 is greater than 10% of total tax revenue in every country.
    Keywords: climate policy, carbon tax, target setting
    JEL: H21 Q54
    Date: 2012–04
  4. By: Liran Einav; Dan Knoepfle; Jonathan D. Levin; Neel Sundaresan
    Abstract: We estimate the sensitivity of Internet retail purchasing to sales taxes using data from the eBay marketplace. Our first approach exploits the fact that seller locations are revealed only after buyers have expressed interest in an item by clicking on its listing. We use millions of location "surprises" to estimate price elasticities with respect to the effective sales tax. We then use aggregated data to estimate cross-state substitution parameters, and substitution between offline and online purchases, relying on the variation in state and local sales taxes, and on changes in these rates over time. We find substantial sensitivity to sales taxes. Using our item-level approach, we find a price elasticity of around -2 for interested buyers. Using our aggregate approach, we find that a one percentage point increase in a state's sales tax increases online purchases by state residents by just under two percent, but decreases their online purchases from home-state retailers by 3-4 percent.
    JEL: D12 H20 H71 L81
    Date: 2012–04
  5. By: Kenji Fujiwara (School of Economics, Kwansei Gakuin University); Ryoma Kitamura (Graduate School of Economics, Kwansei Gakuin University)
    Abstract: Constructing a model of oligopoly with free entry, this paper examines the effects of a tariff reduction accompanied with a unit of consumption tax increase on welfare, government revenue, and market access. We show that the suggested policy reform reduces welfare while enhancing government revenue and market access by inducing further excess entry. Some implications of this finding are discussed in comparison with the case with a fixed number of firms, which involves a welfare loss and an ambiguous effect on government revenue and market access.
    Keywords: tariff-tax reform, oligopoly, free entry, welfare, government revenue, market access.
    JEL: F12 F13
    Date: 2012–04

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