Framework investigations for harmonizing global taxation of internet commerce

Identifies and evaluates contemporary global approaches to taxation in internet commerce. Adapts the principles of evidence-based medicine to develop a working model for evidence-based taxation. A collaborative extranet structure is used to validate the axioms underpinning the critical success factors for a modern knowledge management solution.

Improving our superannuation regime : a post-Henry review look at superannuation taxation, raising superannuation balances and longevity insurance

This paper examines what, if any changes should be made regarding certain aspects of the superannuation system. Specifically, it looks at possible changes to the superannuation tax regime, measures intended at increasing superannuation balances, as well as policies aimed at improving the price and availability of retirement income streams. The recommendations of the final report of the Henry Review on these issues are also critically evaluated. The paper finds that a greater targeting of superannuation tax concessions towards middle and lower income earners would make the system more equitable and achieve other desirable goals such as increasing voluntary savings. Furthermore, the available evidence suggests that the current mandatory contributions rate of 9% is adequate, and a higher contributions rate is likely to have more costs than benefits. On the issue of superannuation income streams, the article finds that whilst taxpayers should continue to be allowed to take their superannuation as a lump sum, policies should be implemented to make lifetime annuities more readily available and better value for money. The Henry Review's recommendations on these issues, with some exceptions, are for the most part sound and based on logic.

Optimal second best taxation of addictive goods in dynamic general equilibrium: a revenue raising perspective

In this paper we derive conditions under which optimal tax rates for addictive goods exceed tax rates for non-addictive consumption goods within a rational addiction framework where exogenous government spending cannot be financed with lump sum taxes. We reexamine classic results on optimal commodity taxation and find a rich set of new findings. Two dynamic effects exist. First, households anticipating higher future addictive tax rates reduce current addictive consumption, so they will be less addicted when the tax rate increases. Therefore, addictive tax revenue falls prior to the tax increase. Surprisingly, the optimal tax rate on addictive goods is generally decreasing in the strength of tolerance, since strong tolerance strengthens this tax anticipation effect. Second, high current tax rates on addictive goods make households less addicted in the future, affecting all future tax revenues in a way which depends on how elasticities are changing over time. Classic results on uniform commodity taxation emerge as special cases when elasticities are constant and the addiction function is homogeneous of degree one. Finally, we also study features of addictive goods such as complementarity to leisure that, while not directly related to the definition of addiction, are nonetheless properties many addictive goods display.

Investment in human capital in a macrodynamic framework: redistributive taxation, public debt and welfare

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Optimal taxation with gradual learning of types

An important feature of life-cycle models is the presence of uncertainty regarding one’s labor income. Yet this issue, long recognized in different areas, has not received enough attention in the optimal taxation literature. This paper is an attempt to fill this gap. We write a simple 3 period model where agents gradually learn their productivities. In a framework akin to Mirrlees’ (1971) static one, we derive properties of optimal tax schedules and show that: i) if preferences are (weakly) separable, uniform taxation of goods is optimal, ii) if they are (strongly) separable capital income is to rate than others forms of investiment.

Public expenditures taxation and welfare measurement

this article addresses the welfare and macroeconomics effects of fiscal policy in a frarnework where govemment chooses tax rates and the distribution of revenues between consumption and investment. We construct and simulate a model where public consumption affects individuaIs' utility and public capital is an argument of the production function. The simulations suggest that by simply reallocating expenditures from consumption to investment, the govemment can increase the equilibrium leveIs of capital stock, hours worked, output and labor productivity. Funhennore, we 'show that the magnitude and direction of the long run impact of fiscal policy depends on the size of the elasticity of output to public capital. If this parameter is high enough, it may be the case that capital stock, within limits, increases with tax rates.

Essays in taxation and savings

Esta tese é composta por três artigos. Dois deles investigam assuntos afeitos a tributação e o terceiro é um artigo sobre o tema “poupança”'. Embora os objetos de análise sejam distintos, os três possuem como característica comum a aplicação de técnicas de econometria de dados em painel a bases de dados inéditas. Em dois dos artigos, utiliza-se estimação por GMM em modelos dinâmicos. Por sua vez, o artigo remanescente é uma aplicação de modelos de variável dependente latente. Abaixo, apresenta-se um breve resumo de cada artigo, começando pelos dois artigos de tributação, que dividem uma seção comum sobre o ICMS (o imposto estadual sobre valor adicionado) e terminando com o artigo sobre poupança. O primeiro artigo analisa a importância da fiscalização como instrumento para deter a evasão de tributos e aumentar a receita tributária, no caso de um imposto sobre valor adicionado, no contexto de um país em desenvolvimento. O estudo é realizado com dados do estado de São Paulo. Para tratar questões relativas a endogeneidade e inércia na série de receita tributária, empregam-se técnicas de painel dinâmico. Utiliza-se como variáveis de controle o nível do PIB regional e duas proxies para esforço fiscal: a quantidade e o valor das multas tributárias. Os resultados apontam impacto significativo do esforço fiscal nas receitas tributárias. O artigo evidencia, indiretamente, a forma como a evasão fiscal é afetada pela penalidade aplicada aos casos de sonegação. Suas conclusões também são relevantes no contexto das discussões sobre o federalismo fiscal brasileiro, especialmente no caso de uma reforma tributária potencial. O segundo artigo examina uma das principais tarefas das administrações tributárias: a escolha periódica de contribuintes para auditoria. A melhora na eficiência dos mecanismos de seleção de empresas tem o potencial de impactar positivamente a probabilidade de detecção de fraudes fiscais, provendo melhor alocação dos escassos recursos fiscais. Neste artigo, tentamos desenvolver este mecanismo calculando a probabilidade de sonegação associada a cada contribuinte. Isto é feito, no universo restrito de empresas auditadas, por meio da combinação “ótima” de diversos indicadores fiscais existentes e de informações dos resultados dos procedimentos de auditoria, em modelos de variável dependente latente. Após calculados os coeficientes, a probabilidade de sonegação é calculada para todo o universo de contribuintes. O método foi empregado em um painel com micro-dados de empresas sujeitas ao recolhimento de ICMS no âmbito da Delegacia Tributária de Guarulhos, no estado de São Paulo. O terceiro artigo analisa as baixas taxas de poupança dos países latino-americanos nas últimas décadas. Utilizando técnicas de dados em painel, identificam-se os determinantes da taxa de poupança. Em seguida, faz-se uma análise contrafactual usando a China, que tem apresentado altas taxas de poupança no mesmo período, como parâmetro. Atenção especial é dispensada ao Brasil, que tem ficado muito atrás dos seus pares no grupo dos BRICs neste quesito. O artigo contribui para a literatura existente em vários sentidos: emprega duas amplas bases de dados para analisar a influência de uma grande variedade de determinantes da taxa de poupança, incluindo variáveis demográficas e de previdência social; confirma resultados previamente encontrados na literatura, com a robustez conferida por bases de dados mais ricas; para alguns países latino-americanos, revela que as suas taxas de poupança tenderiam a aumentar se eles tivessem um comportamento mais semelhante ao da China em outras áreas, mas o incremento não seria tão dramático.

Commodity Taxation and Social Insurance

We investigate optimal commodity taxation in a social insurance framework based on Varian (1980). We show that the tax prescriptions in this moral hazard framework are notably similar to those derivetaxation are valid in this setup. We incorporate pre-committed goods - those whose consumption must be decided before the resolution of uncertainty - and show that tax prescriptions are also analogous to the existing literature. The robustness of tax rules across these setups is explained by the relaxation of incentive compatibility constraints.

Optimal exchange rate policy, optimal incomplete taxation and business cycles

Implementation and collapse of exchange rate pegging schemes are recur- rent events. A currency crisis (pegging) is usually followed by an economic downturn (boom). This essay explains why a benevolent government should pursue Þscal and monetary policies that lead to those recurrent currency crises and subsequent periods of pegging. It is shown that the optimal policy induces a competitive equilibrium that displays a boom in periods of below average de- valuation and a recession in periods of above average devaluation. A currency crisis (pegging) can be understood as an optimal policy answer to a recession (boom).

On the optimality of the Friedman Rule with heterogeneous agents and non-linear income taxation

We study the optimal “inflation tax” in an environment with heterogeneous agents and non-linear income taxes. We first derive the general conditions needed for the optimality of the Friedman rule in this setup. These general conditions are distinct in nature and more easily interpretable than those obtained in the literature with a representative agent and linear taxation. We then study two standard monetary specifications and derive their implications for the optimality of the Friedman rule. For the shopping-time model the Friedman rule is optimal with essentially no restrictions on preferences or transaction technologies. For the cash-credit model the Friedman rule is optimal if preferences are separable between the consumption goods and leisure, or if leisure shifts consumption towards the credit good. We also study a generalized model which nests both models as special cases.