Why are tax expenditures for giving embodied in fiscal constitutions ? * Kimberley
نویسنده
چکیده
This paper asks whether there can be unanimous support for a fiscal constitution that includes tax expenditures for giving among the set of available fiscal instruments. We describe a political economy model of fiscal choices where individuals with different incomes vote over levels of proportional income taxation and over tax incentives for giving, and investigate how the availability of such incentives affects political equilibrium outcomes and welfare for different income groups. We find that unanimous support for the use of tax incentives for giving can indeed arise, and is more likely the more unequal is the distribution of income. 2000 Elsevier Science S.A. All rights reserved.
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