The Inequality of Income Taxation for Resident and Nonresident Taxpayers

Abstract

The paper provides analyses the difference between income taxation system for resident and nonresident taxpayer, in particular the inequality deduction and exemption. The paper emphasizes the different qualification principles for nonresident alien-taxpayer, the treaty benefits for different countries, and the standard deduction. It is a comparative investigation of tax regulations for nonresident aliens in EU countries, Canada, developing countries, and the United States, the experiences of differential income taxation of nonresident aliens in different countries. The objectives are the analyses of inequality of income tax system for resident and nonresident taxpayer, and different exemption, standard deduction. The paper analyzes the positive and negative externalities of this taxation and concludes that responses to tax rate, politic of government revenue, and treaty for different countries changes are far from fully understood and that there is much to be gained from continued research on this topic.