Historically, the Islamic state collected zakat (similar to the tithe of other regions) as national income. In Indonesia, the private sector can raise zakat funds more effectively than the government. In 2010, zakat became tax-deductible income. This paper tries to analyze some factors that affect preference for zakat as a tax deduction in Indonesia. The effectiveness of the regulation is also ...

When product markets are monopolistic, an income redistributive policy affects social welfare not only through changes in disposable income but also through changes in product prices. In the optimal income tax formula, we then obtain a Pigouvian term correcting for this price externality. We provide sufficient conditions when the Pigouvian term is progressive among top earners. Moreover, if the...

The paper examines government spending that is financed by taxes that distort output and by the inflation tax. High inflation and low output are the consequence of fiscal ambitions that exceed the current capacity of the economy to support. Supply-side growth alleviates this tension, allowing lower inflation, lower tax distortions, and higher output. In the presence of commitment problems, reso...

The growth of the modern regulatory state is often explained in terms of an unambiguous increase in regulation driven by the actions of central governments. Contrary to this traditional narrative, we argue that as governments increased state capacity, they often strove to weaken the autarkic tendencies of regional laws, thereby promoting greater trade and a more integrated market. To show this,...

By means of a dynamic panel data analysis, and using a database from municipalities of the province of Barcelona (1993-99), we describe their process of fiscal adjustment to a shock in tax capacity. About 25% of the shock is internalized through an increase in tax effort, 35% through a reduction in public expenditure (mainly investment), while the rest (40%) is covered by an increase in the lev...

This project examines fiscal reforms in Brazil since the 1990s, particularly in taxation, budgeting, and fiscal federalism. While recentralizing fiscal authority and massively expanding the extractive capacity of the state, policymakers chose not to revamp an inefficient tax system that has nonetheless proven capable of generating high levels of revenue. In budgeting, the economic crises of the...

This paper aims at clearing up some misunderstandings about the social impacts of carbon taxes that proved to be a decisive obstacle to their further consideration in public debates. It highlights the gap between the cost of a carbon tax reform as it is spontaneously perceived by the taxpayers and the reality of its ultimate consequences: the real impact on households’ poverty and inequalities ...

It is often argued that implicit taxation on continued activity of elderly workers is responsible for the widely observed trend towards early retirement. In a world of laissez-faire or of first-best efficiency, there would be no such implicit taxation. The point of this paper is that when first-best redistributive instruments are not available, because some variables are not observable, the opt...

Psychological Stress occurs when an individual perceives that environmental demands tax or exceed his or her adaptive capacity. Following this view, that underlines the role of the situated experience of the patient in experiencing a stressor, the European Union funded Interstress project (http://www.interstress.eu) is exploring the possible use of the virtual simulation technology offered by S...

A well-functioning freight transportation system is an essential element in any successful economy. However, at the beginning of the new millennium, the prediction is that the demand for goods movement will outstrip the rate of improvements to the physical infrastructure. Marked growth in time-sensitive freight markets will tax demands on a system that already is operating near capacity in some...