• Health benefits a big potential target for raising revenue: President Bush’s FY 2008 budget estimates all employee benefits-related “tax expenditures” (government revenue foregone due to special tax treatment) will amount to $328 billion next year, or 34 percent of the $961 billion worth of total tax expenditures in the federal budget. Tax-favored employment-based health insurance benefits ac...

The aim of this paper is to describe the state-of-the-art in simulation and to illustrate benefits and problems of linking micro and macro models by analysing flat tax proposals for Germany. The analysis shows that a personal income flat tax can indeed overcome the fundamental equity efficiency trade-off while simultaneously increasing the tax revenue. However, this result does not hold for a f...

Revenue sharing can be used to discourage low tax regions from competing for capital and firms with high tax regions. However, with heterogeneous regions, revenue sharing involves net transfers across regions and creates a “moral-hazard” problem – that is, regions may want to invest less in market fostering public good when the benefits are shared across nations. This paper analyzes these costs...

The paper studies simple strategies of labor tax reform in a search and matching model of the labor market featuring endogenous labor supply. Changing the composition of the tax wedge—that is, reducing a payroll tax and increasing a progressive wage tax such that the marginal tax wedge remains unaffected—increases employment, reduces the equilibrium unemployment rate, and increases public reven...

This paper provides empirical study on the behavior of the Shanghai and the Shenzhen stock exchanges after the Chinese government announced to increase the securities transaction tax from 0.3% to 0.5% in May 9, 1997. We examine the impact of the increased transaction tax on the volatility of stock returns and tax revenue. We find that the return volatility significantly increased. We also find ...

Roads cover a significant fraction of the land area in many municipalities. The public provision of roads means this land is exempt from the local property tax. Transferring roads from public to private ownership would not only remove maintenance costs from city budgets, but increase potential property tax revenue as well. This paper calculates the value of the land occupied by roads in sample ...

This paper estimates the effects of same-sex marriage legalization on federal income tax revenue using changes in taxation generated from the 2003 Jobs and Growth Tax Relief Reconciliation Act. These estimates rely critically on the responsiveness of labor supply and marital choice to changes in the tax code. In addition, this paper proposes a novel measure of the marriage penalty that incorpor...

Consistent estimation of the tax revenue elasticity is complicated by the endogenous response of GDP to changes in tax rates and measurement error in national accounts statistics. This paper exploits the significant response of real GDP growth of Sub-Saharan African countries to exogenous international commodity price and rainfall shocks to construct instrumental variables estimates of the tax ...

Annual growth rates of real GDP in New Zealand have varied widely, from 18% to −8%, since World War II. During this period the tax burden (the ratio of tax revenue to GDP) has trended upward from 23% to 35%. The tax mix (the ratio of indirect taxes to direct taxes) has varied between 0.31 and 0.75, having increased recently with the introduction of the goods and services tax. In this paper we e...

Taxes make up the bulk of any government revenue and provide a sustainable source of revenue. In recent years, the main focus of the tax reform program, in almost all countries of the world, has been on VAT. But a major problem in the effective implementation of VAT, which is a nascent tax base in countries, is the phenomenon of tax evasion. Therefore, one of the most basic steps in preventing ...