scholarly journals Optimal Taxation and Optimal Tax Systems

1990 ◽  
Vol 4 (1) ◽  
pp. 157-178 ◽  
Author(s):  
Joel Slemrod
Keyword(s):  
Tax Policy ◽  
Restricted Problem ◽  
Optimal Taxation ◽  
Critical Determinant ◽  
Tax System ◽  
Current State ◽  
Optimal Tax ◽  
Critical Issues ◽  
Resource Cost ◽  
Tax Systems

In its current state, optimal tax theory is incomplete as a guide to action for critical issues in tax policy. It is incomplete because it has not yet come to terms with taxation as a system of coercively collecting revenues from individuals who will tend to resist. The coercive nature of collecting taxes implies that the resource cost of implementing a tax system is large. Furthermore, alternative tax systems differ greatly in the resource cost of operation. Differences in the ease of administering various taxes have been and will continue to be a critical determinant of appropriate tax policy. I will first walk the reader through three of the principal propositions of optimal tax theory, pointing out along the way the key assumptions of the restricted problem under consideration. Next, I comment on the influence of the theory on recent tax policy developments. I conclude by sketching an alternative to optimal taxation, which I call the theory of optimal tax systems. This theory embraces the insights of optimal taxation but also takes seriously the technology of raising taxes and the constraints placed upon tax policy by that technology. A theory of optimal tax systems has the promise of addressing some of the fundamental issues of tax policy in a more satisfactory way than the theory of optimal taxation.

scholarly journals Fiscal Policy and Optimal Taxation in Sierra Leone: Testing for Tax Smoothing Hypothesis

2022 ◽  
Vol 14 (2) ◽  
pp. 61
Author(s):  
Samuel Bonzu
Keyword(s):  
Random Walk ◽  
Sierra Leone ◽  
Tax Policy ◽  
Optimal Taxation ◽  
Tax Rate ◽  
Optimal Tax Policy ◽  
Optimal Tax ◽  
Review Period ◽  
Tax Smoothing ◽  
The Government

This paper empirically investigate whether the budget imbalances in Sierra Leone over the review period is consistent with optimal tax policy. The procedure involves testing if tax smoothing hypothesis hold for Sierra Leone. In this regard, three different empirical approaches were performed. Firstly, I examine the random walk property of the tax rate. The null hypothesis of non-stationarity of tax rate could not be rejected, which implies the tax rate follows random walk. Second, I examined whether changes in tax rate is predictable by regressing changes in tax rate by its own lagged values. The result shows that tax rate is unpredictable, as changes in tax cannot be determined by its lagged values. Finally, a VAR model was employed to examine whether tax rate can be predicted by its own lagged values together with changes in the government spending rate and the growth rate of real GDP. The results indicate that all the variables employed were found not be significant is predicating the tax rate. Overall, all the empirical estimations support the existence of tax smoothing over the sample period and that the budget inbalances over the review period is consistent with optimal tax policy.

scholarly journals Should the Law Do Anything about Economic Inequality

2018 ◽  
Author(s):  
Matthew Dimick
Keyword(s):  
Tax Policy ◽  
Law And Economics ◽  
Economic Inequality ◽  
Wealth Inequality ◽  
Legal Rule ◽  
Tax System ◽  
Legal Rules ◽  
Optimal Tax Policy ◽  
Optimal Tax ◽  
Redistribute Income

Cornell Journal of Law and Public Policy: Vol. 26 : Iss. 1 , Article 1What should be done about rising income and wealth inequality? Should the design and adoption of legal rules take into account their effects on the distribution of income and wealth? Or should the tax-and transfer system be the exclusive means to address concerns about inequality? A widely-held view argues for the latter: only the tax system, and not the legal system, should be used to redistribute income. While this proposition comes in a variety of normative arguments and has support across the political spectrum, there is also a well-known law-and economics version. This argument, known as the “double-distortion” argument, is simply stated. Legal rules that redistribute income only add to the economic distortions that are already present in the tax system. It would therefore be better for everyone, and especially the poor, to instead adopt an efficient, nonredistributive legal rule, and increase redistribution through the tax system.This Article challenges the double-distortion argument from a law and-economics perspective. There are two main arguments, in addition to several other subsidiary points. First, in the abstract, there is no reason to believe that legal rules that have redistributive effects will always reduce efficiency; indeed, they can sometimes increase efficiency. Examples from the regulation of product markets, labor markets, and financial markets underscore this claim. In these cases, legal redistribution is more efficient than redistribution through the tax system. Second, legal rules are likely to be more attractive than taxation precisely in cases where inequality itself or normative concern about inequality is high. Under the optimal tax policy, higher inequality or greater concern about inequality will justify larger tax distortions. Therefore, a particular legal rule is more likely to be more efficient than the optimal tax policy under these circumstances. The ultimate conclusion is that a mix of legal rules and taxation, rather than taxation exclusively, will be the best way to address economic inequality.

scholarly journals Optimal Taxation in Theory and Practice

2009 ◽  
Vol 23 (4) ◽  
pp. 147-174 ◽  
Author(s):  
N. Gregory Mankiw ◽  
Matthew Weinzierl ◽  
Danny Yagan
Keyword(s):  
Optimal Design ◽  
Tax Policy ◽  
Optimal Taxation ◽  
Theory And Practice ◽  
Tax System ◽  
Academic Literature

The optimal design of a tax system is a topic that has long fascinated economic theorists and flummoxed economic policymakers. This paper explores the interplay between tax theory and tax policy. It identifies key lessons policymakers might take from the academic literature on how taxes ought to be designed, and it discusses the extent to which these lessons are reflected in actual tax policy.

scholarly journals Optimal Tax Theory: Its Contributions to the Brazilian Reality

2021 ◽  
Vol 25 (2) ◽  
Author(s):  
Camilla Fagner de Carvalho e Costa ◽  
Jeferson de Castro Vieira
Keyword(s):  
Tax Policy ◽  
Public Management ◽  
Optimal Taxation ◽  
Social Issues ◽  
Secondary Data ◽  
Well Being ◽  
Tax Reforms ◽  
Socially Responsible ◽  
Economic Agents ◽  
Optimal Tax

ABSTRACT Objectives: this theoretical essay aims to present classic and contemporary fundamentals of the optimal tax theory (OTT) and to problematize its presence and possibilities in the scenario of tax policy in Brazil. Context: such objectives are located in the contemporary context that discusses tax reforms aimed at efficient and socially responsible public management. Methods: after surveying the state of knowledge of optimal taxation in Brazil, and from the perspective of economics and political law, we sought to identify secondary data on tax distribution in Organization for Economic Co-operation and Development (OECD) countries in relational analysis with data from Brazil. Results: the text draws attention to the fact that OTT is able to bring social issues to the discussion of public tax management policies in a structured way, with the perspective of inclusion and social responsibility, based on the importance of different treatment of economic agents, physical and legal, based on their needs and possibilities. Conclusion: it is concluded that, like in other countries, OTT is present in the Brazilian debate expressing as possible and necessary to advance in a tax policy that responds to the needs of public collection articulated and reconciled to social well-being through responsible management, modern and transparent.

Levels taxation countries the EU and Ukraine’s

2019 ◽  
pp. 131-160
Author(s):  
Helena Borzenko ◽  
Tamara Panfilova ◽  
Mikhail Litvin
Keyword(s):  
European Union ◽  
Uniform Distribution ◽  
Tax Burden ◽  
Tax System ◽  
Tax Legislation ◽  
Improvement Process ◽  
Tax Systems ◽  
Historical Comparative ◽  
Different Levels ◽  
The Eu

Purpose articles rassm and experience and benefits systems taxation countries European Union, manifestation iti the main limitations domestic taxlegislation and wired STI their comparisons. In general iti ways the provisiontax reporting countries Eurozone in the appropriate organs, dove STI need theintroduction Ukraine electronic methods receiving and processing such reports.define iti key directions reforming domestic tax legislation. Methodology research is to use aggregate methods: dialectical, statistical, historical, comparative. Scientific novelty is to are provided recommendations for improvement ofefficiency systems taxation of our states in international ratings characterizingtax institutions country. Therefore, despite some problems in legislation heldcomparative study systems taxation EU and Ukraine. Conclucions Coming fromof this, the main directions reforming tax systems Ukraine, in our opinion,today should become: improvement process administration, reduce scales evasiontaxes, provision more uniform distribution tax burden between taxpayers, themaximum cooperation tax bodies different levels as well adjustment systemselectronic interactions tax authorities and payers, tax system must contain ascan less unfounded benefits, consistent with the general by politics pricing.

Commonalities and differences of tax systems in West Balkan countries Comparative analysis

2015 ◽  
Vol 3 (1) ◽  
pp. 155 ◽  
Author(s):  
Teuta Balliu ◽  
Aida Gaçe Llozana
Keyword(s):  
Economic Development ◽  
Comparative Analysis ◽  
Foreign Direct Investments ◽  
Fiscal Policies ◽  
Fiscal Discipline ◽  
Tax System ◽  
Revenue Collection ◽  
Balkan Countries ◽  
The Subject ◽  
Tax Systems

Countries of former Yugoslavia and Albania are considered as countries with many common problems as well as changes, which in this context are regarded as insignificant. On their way towards development, these countries are characterized by common problem, among which the most sensitive have been and still remain, unemployment, increasingly compressed public administration, unjustified optimism when planning the budget, mismanagement of public finances and poor fiscal discipline which mostly depends on being or not an election year. In these countries we notice the lack of harmony between economic and fiscal policies and the real needs of the economy. This is seen as other major common ofWest Balkan countries. This similiarity of problems narrows the possibility of competition associated to the foreign investment absorbing capacity. But, which is the moacroeconomic picture in the countries of West Balkan? What are their tax systems? How much are the foreign direct investments? Does the tax system serve as a promoter for these invvestments? This paper represents a comparative analysis of the fiscal systems in the countries of this region. The subject of this paper is the protection with arguments of the economic and fiscal policy which are built for the economic development of a country. This because we are given that there are two types of experiences related to tax system, one of which handles taxes as instruments for revenue collection and the other as a promoter factor for economic development.

Banking on Failure

2020 ◽  
Author(s):  
Richard S Collier
Keyword(s):  
Financial Markets ◽  
Financial Institutions ◽  
Current Position ◽  
Tax System ◽  
Number Of Factors ◽  
Tax Systems

This book seeks to explain why and how banks ‘game the system’. More specifically, its objective is to account for why banks are so often involved in cases of misconduct and why those cases often involve the exploitation of tax systems. To do this, a case study is presented in Part I of the book. This case study concerns a highly complex transaction (often referred to as ‘cum-ex’) designed to exploit a flaw at the intersection of the tax system and the financial markets settlements system. It was entered into by a very large number of banks and other financial institutions. A number of factors make the cum-ex transaction remarkable, including the sheer scale of the financial amounts involved, the large number of banks and financial institutions involved, the comprehensive failure of the controls infrastructure in this highly regulated sector, and the fact that authorities across Europe have found it so difficult to deal with the transaction. Part II of the book draws out the wider significance of cum-ex and what it tells us about modern banks and their interactions with tax systems. The account demonstrates why the exploitation of tax systems by banks is practically inevitable due to a variety of systemic features of the financial markets and of tax systems themselves. A number of possible responses to the current position are suggested in the final chapter.

WHAT IS AN "OPTIMAL" TAX SYSTEM?

1996 ◽  
Vol 49 (1) ◽  
pp. 117-133 ◽  
Author(s):  
JAMES ALM
Keyword(s):  
Tax System ◽  
Optimal Tax

HOUSING DEPRECIATION AND OPTIMAL TAX POLICY

1979 ◽  
Vol 32 (4) ◽  
pp. 471-479
Author(s):  
CHESTER C. McGUIRE
Keyword(s):  
Tax Policy ◽  
Optimal Tax Policy ◽  
Optimal Tax
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