Download or read book Capital Income Taxation and the Current Account in a Small Open Economy written by Yasushi Iwamoto and published by . This book was released on 1989 with total page 48 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Vanishing Tax on Capital Income in the Open Economy written by Assaf Razin and published by . This book was released on 1991 with total page 30 pages. Available in PDF, EPUB and Kindle. Book excerpt: The increased integration of the world capital market implies that the supply of capital becomes more elastic, and therefore potentially a less efficient base for taxation. In general, the optimal taxation of capital income is subject to two conflicting forces. On the one hand the return on existing capital is a pure rent which is efficient to fully tax away. On the other hand taxing the returns on investment in new capital would retard growth, thus generating inefficiencies. Capturing these considerations, the paper carries out a simple optimal tax analysis for an open economy, which is fully integrated in the world capital markets. The analysis identifies well defined circumstances in which the capital income tax vanishes.

Download or read book Capital Income Taxation and Risk taking in a Small Open Economy written by Patrick K. Asea and published by . This book was released on 1997 with total page 62 pages. Available in PDF, EPUB and Kindle. Book excerpt: How do capital income taxes affect household portfolio choice and growth? We" approach this question within the context of a stochastic model of a small open economy in" which taxes on income from domestic capital (equity) and foreign bonds affect household" portfolio choice, welfare and the growth rate of the economy. The theoretical and numerical" analysis demonstrates the important role that risk plays in determining the mean and variability" of growth as well as the conditions under which a higher tax rate can be welfare improving. To" shed more light on the complex theoretical interaction between taxes and risk-taking we estimate" a reduced-form multinomial probit model of household portfolio choice using the method of" simulated moments. The empirical evidence is in stark contrast to the conventional wisdom " we find that higher taxes make it less likely that the household will hold risky assets."

Download or read book The Status of Capital Income Taxation in the Open Economy written by Assaf Razin and published by . This book was released on 1994 with total page 52 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Social Comparisons and Optimal Taxation in a Small Open Economy written by Thomas Aronsson and published by . This book was released on 2020 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this paper, we analyze how international capital mobility affects the optimal labor and capital income tax policy in a small open economy when consumers care about relative consumption. The main results crucially depend on whether the government can tax returns on savings abroad. If the government can use flexible residence-based capital income taxes, then the optimal policy rules from a closed economy largely carry over to the case of a small open economy. If it cannot, then capital income taxes become completely ineffective. The labor income taxes must then indirectly also reflect the corrective purpose that the absent capital income tax would have had.

Download or read book Reforming Capital Income Taxation written by Horst Siebert and published by Routledge. This book was released on 2019-07-11 with total page 281 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book surveys the theoretical issues that characterize the problem of reforming capital income taxes in an open economy. It explores the tax incentives and disincentives to investment in an open economy framework allowing cross-border portfolio and direct investment.

Download or read book The Economic Effects of Taxing Capital Income written by Jane Gravelle and published by MIT Press. This book was released on 1994 with total page 370 pages. Available in PDF, EPUB and Kindle. Book excerpt: How should capital income be taxed to achieve efficiency and equity? In this detailed study, tax policy analyst Jane Gravelle, brings together comprehensive estimates of effective tax rates on a wide variety of capital by type, industry, legal form, method of financing, and across time. These estimates are combined with a history and survey of issues regarding capital income taxation that are aimed especially at bringing the findings of economic theory and recent empirical research to nonspecialists and policymakers. Many of the topics treated have been the subject of policy debate and legislation over the last ten or fifteen years.Should capital income be taxed at all? And, if capital income is to be taxed, what is the best way to do it? Gravelle devotes two chapters to the first question, and then, in answer to the second question, covers a broad range of topics - corporate taxation, tax neutrality, capital gains taxes, tax treatment of retirement savings, and capital income taxation and international competitiveness. Gravelle also includes a comprehensive history of tax institutions and data on constructing effective tax rates that are not available elsewhere.

Download or read book Competition for Capital written by Stefan Sinn and published by . This book was released on 1993 with total page 116 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Balancing Act Weighing the Factors Affecting the Taxation of Capital Income in a Small Open Economy written by M.K. McKeehan and published by . This book was released on 2017 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Alternative economic theories yield dramatically different prescriptions for optimal capital taxation in small open economies. On the one hand, foreign firms, including those with investments that yield firm-specific above-normal returns, have a large number of alternative investment opportunities; this suggests that the supply of foreign direct investment is highly elastic, which implies that small open economies should avoid imposing any source-based taxes on capital income. On the other hand, governments invariably want to tax any above-normal returns earned by location-specific capital, especially if the returns accrue to foreigners, and to take full advantage of the potential revenue increase from any "treasury transfer" effect that arises due to residence-based tax systems with foreign tax credits, such as that utilized by the USA. These factors suggest that investment is highly inelastic with respect to capital taxation, so that source-based capital income taxation is desirable; indeed, in one special case, the capital income tax rate for a small open economy should equal the relatively high US tax rate. Moreover, this difficult trade-off is in practice complicated by numerous additional factors: deferral of unrepatriated profits and cross-crediting of foreign tax credits for the US multinationals, foreign direct investment from firms from countries that, unlike the USA, operate territorial systems, and the existence of opportunities for both international capital income shifting and labour income shifting. In this paper, the authors analyze optimal capital income taxation in a small open economy model that attempts to balance these conflicting factors.

Download or read book Optimal Capital Income Taxes and Capital Controls in Small Open Economies written by Bernd Huber and published by . This book was released on 1998 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper studies the optimal taxation of capital income in a simple model of a small open economy where domestic residents can evade taxes on their foreign investment income. The national government can only tax domestic capital income and can impose capital controls, which, however, absorb real resources. The design of optimal policy in this model depends on the revenue needs of the government. For relatively low levels of government expenditures, it turns out that the country does not levy capital income taxes but may restrict capital exports. Otherwise, the country taxes domestic capital income and sets capital controls such that capital exports are driven to zero, at an optimum. In contrast to other models with capital controls, it turns out that this policy can lead to underinvestment in domestic capital.

Download or read book On the Optimal Taxation of Capital Income in the Open Economy written by David G. Hartman and published by . This book was released on 1985 with total page 22 pages. Available in PDF, EPUB and Kindle. Book excerpt: The optimal taxation of foreign and domestic investors' incomes is examined with a simple overlapping-generations model. Even when tax rates are allowed to discriminate between these groups, the optimal tax rates on both domestic and foreign investors' incomes in the small open economy are identical and equal to the optimal rate of tax in the closed economy. In light of the emphasis in the literature on the extent to which the elasticity of international flows might lower optimal capital income taxes, this conclusion is quite a surprise. In the large open economy, the optimal tax rate on foreign investors'income alone is a weighted average of one and the small economy tax rate. The optimal tax rate on domestic income is, again, unaffected by the openness ofthe economy. When a uniform tax rate must be set in the large open economy, it is generally higher than the optimal tax rate for a closed economy, a conclusion contrary to the conventional wisdom. However, a higher elasticity of international capital flows is associated with a lower tax rate, as expected, butthe rate remains above the closed-economy rate. In summary, openness matters for optimal tax policy, primarily in the case of the large economy. The reason is mainly the ability to burden foreign investors with a tax liability

Download or read book Taxation and Endogenous Growth in Open Economies written by Nouriel Roubini and published by . This book was released on 1994 with total page 48 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines the effects of taxation of human capital, physical capital and foreign assets in a multi-sector model of endogenous growth. It is shown that in general the growth rate is reduced by taxes on capital and labor (human capital) income. When the government faces no borrowing constraints and is able to commit to a given set of present and future taxes, it is shown that the optimal tax plan involves high taxation of both capital and labor in the short run. This allows the government to accumulate sufficient assets to finance spending without any recourse to distortionary taxation in the long run. When restrictions to government borrowing and lending are imposed, the model implies that human and physical capital should be taxed similarly.

Download or read book Capital Income Taxation and Economic Growth in Open Economies written by Mr.Geremia Palomba and published by INTERNATIONAL MONETARY FUND. This book was released on 2004-05-01 with total page 28 pages. Available in PDF, EPUB and Kindle. Book excerpt: Do reductions in capital income taxes attract foreign capital and, at the same time, foster economic growth? This paper examines the effect of capital income taxation on the international allocation of capital and on economic growth in a two-country overlapping generations model with endogenous growth and internationally mobile capital. It shows that domestic capital taxes affect both the international allocation of capital and the rate of economic growth and that these two effects are not necessarily the same. A country can increase its share of the existing world capital by changing its taxes but, depending on the elasticity of saving to after-tax returns, this may reduce the rate of capital accumulation and economic growth.

Download or read book On Capital Formation and the Effects of Capital Income Taxation written by Ragnar Lindgren and published by . This book was released on 1985 with total page 232 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The Incidence of Taxes on Income from Capital in an Open Economy written by Arnold C. Harberger and published by . This book was released on 1982 with total page 34 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Can Capital Income Taxes Survive in Open Economies written by Roger Hall Gordon and published by . This book was released on 1990 with total page 18 pages. Available in PDF, EPUB and Kindle. Book excerpt: Recent theoretical work has argued that a small open economy should use residence-based but not source-based taxes on capital income. Given the ease with which residents can evade domestic taxes on foreign earnings from capital, however, a residence-based tax may not be administratively feasible, leaving no taxes on capital income.

Download or read book The Welfare Effects of a Capital Income Tax in an Open Economy written by David G. Hartman and published by . This book was released on 1985 with total page 23 pages. Available in PDF, EPUB and Kindle. Book excerpt: International capital mobility has typically been ignored in discussions of the welfare effects of the capital income tax. In the a typical analysis which does consider the open economy it is recognized that highly-elastic capital flows could significantly alter the usual conclusions. While there have been strenuous debates about the elasticity of international capital flows, there can be little disagreement that international ownership of capital is an important and growing phenomenon. In this paper, we explore the welfare effects of changes in the capital income tax from a different perspective: that of a country in which foreign ownership of a portion of the capital stock and foreign owners' payment of taxesis a reality. With this modification in emphasis, a simple graphical analysis is sufficient to indicate that international capital ownership could easily dominate other welfare effects of tax changes. At least, the arguments presented in this paper raise a caution about ignoring the openness of the economy simply because elasticities are believed small