New Economics Papers
on Public Finance
Issue of 2005‒02‒06
three papers chosen by

  1. On the Redistributive Properties of Presumptive Taxation By Alessandro Balestrino; Umberto Galmarini
  2. Taxation and Economic Efficiency: Results from a Canadian CGE Model By Maximilian Baylor; Louis Beauséjour
  3. Taxing Electronic Commerce: The End of the Beginning? By Richard M. Bird

  1. By: Alessandro Balestrino; Umberto Galmarini
    Abstract: Presumptive taxation, in which an income proxy is used as tax base, has been and is still used today in countries with very diverse situations - developing, transition and developed countries. Usually, this form of taxation is thought of as a revenue-raising device in presence of widespread imperfect tax compliance. We investigate the question of whether presumptive taxation can be used as a redistributive instrument. To this end, we employ an occupational choice model in which an individual can be either an entrepreneur or a worker. We allow for different abilities to dodge taxes across social classes, and consider both the case in which a conventional income tax is in place alongside presumptive taxation and the case in which only presumptive taxation is operating. We argue that a revenue-neutral reform introducing a lump-sum presumptive tax based on occupational choice can improve social welfare, and sometimes even lead to a Pareto-improvement.
    Keywords: tax avoidance, presumptive taxation, redistribution, occupational choice
    JEL: H21 H26
    Date: 2005
  2. By: Maximilian Baylor; Louis Beauséjour
    Abstract: This paper introduces a dynamic general equilibrium tax model of the Canadian economy. The model incorporates each of the major taxes in Canada and features adjustment dynamics, intertemporal optimization, imperfect substitution between domestic and foreign goods and assets, and industry disaggregation. In addition to describing the model, this study uses it to compare the effects of different tax measures on the Canadian economy with a focus on measures that directly target investment and saving. <P> Cette étude présente un modèle d’équilibre général dynamique de taxation de l’économie canadienne. Le modèle, qui incorpore les principales taxes canadienne, se caractérise, entre autres, par l’optimisation intertemporelle des agents, la substitution imparfaite entre biens et actifs de provenances domestique et étrangère, ainsi que par la désagrégation sectorielle de l’économie. Outre la description du modèle, l’étude compare les effets de différents instruments de taxation sur l’économie canadienne avec une emphase sur les instruments ciblant directement l’investissement et l’épargne.
  3. By: Richard M. Bird (University of Toronto)
    Abstract: This paper discusses what the growth of e-commerce means for tax policy and administration, both within countries and between them. Although the fiscal implications of such commerce as yet remain limited, the future may be different and the issues are important. The issues are first discussed with respect to consumption taxes, noting some differences in the situations facing the United States (US) on one hand, the European Union (EU) on the other, and Canada, which in some ways combines characteristics of both. When it comes to income taxes, however, everybody seems to be in more or less the same boat, although the new technology may offer solutions as well as problems for those in the tax business. The paper concludes that, while of course the future remains unknown, when it comes to taking action to deal with the potential implications of e-commerce for taxation, we are by no means at the beginning of the end, but we may, perhaps, be at the end of the beginning.
    Keywords: taxation, electronic commerce, value-added tax, retail sales tax
    JEL: H20 H71 H87
    Date: 2005–01

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