Optimal Indirect and Capital Taxation
نویسندگان
چکیده
منابع مشابه
Optimal Indirect and Capital Taxation
We consider an environment in which agents’ skills are private information and follow arbitrary stochastic processes. We prove that it is typically Pareto optimal for an individual’s marginal benefit of investing in capital to exceed his marginal cost of doing so. This wedge is consistent with a positive tax on capital income. We also prove that it is Pareto optimal for the marginal rate of sub...
متن کاملOptimal Capital Income Taxation∗
In an economy with identical infinitely-lived households that obtain utility from leisure as well as consumption, Chamley (1986) and Judd (1985) have shown that the optimal tax system to pay for an exogenous stream of government purchases involves a zero tax rate on capital in the long run, with tax revenue collected by a distortionary tax on labor income. Extending the results of Hall and Jorg...
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This paper studies the e ects of agent heterogeneity on optimal capital income tax rates. In a two period model with arbitrarily many heterogeneous agents, we explicitly derive the welfare e ects of taxation depending on the distribution of the agents' characteristics. In particular, we show that the sign of the optimal capital income tax rate depends not on the extent of inequality in goods en...
متن کاملPreference heterogeneity and optimal capital income taxation
We analytically and quantitatively examine a prominent justi cation for capital income taxation: goods preferred by those with high ability ought to be taxed. We study an environment where commodity taxes are allowed to be nonlinear functions of income and consumption and nd that, when ability is positively related to a preference for a good, optimal marginal commodity taxes on this good may b...
متن کاملOn the Optimal Taxation of Capital Income
We show that in models in which labor services are supplied jointly with human capital, the Chamley and Judd result on zero capital income taxation in the limit extends to labor taxes as long as accumulation technologies are constant returns to scale. Moreover, for a class of widely used preferences, consumption taxes are zero in the limit as well. However, we show by the construction of two ex...
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ژورنال
عنوان ژورنال: Review of Economic Studies
سال: 2003
ISSN: 0034-6527,1467-937X
DOI: 10.1111/1467-937x.00256