Capital Tax Research Articles

Dynamical analysis of healthcare policy effects in an integrated economic-epidemiological model

We study the static and dynamical properties of a model that describes the interaction between the economic and epidemiological domains. The epidemiological sphere is represented by a susceptible–infected–susceptible model, while the economic domain consists of an overlapping generations model in which the workers correspond to the non-infected population of adults. The productivity of the firms and the propensity to save for retirement of the households are negatively affected by the disease spread. A capital tax is levied and the collected resources are used to curb the spread of the outbreak. We show that multiple endemic steady states can arise from the interaction between the two domains, and different stable endemic attractors can coexist with the stable disease free steady state. We study analytically and numerically the complex dynamics and the evolution of the basins of attraction in the case of multistability. We show that the effect of taxation can be beneficial from both the epidemiological and the economic points of view, as it can give rise to new steady states characterized by reduced shares of infected people and increased capital level, it can simplify the dynamical behaviors and reduce the size of the basins of attraction of those outcomes in which large shares of infected people and low capital levels are observed.

Wealth Inequality in the South: Multi‐Source Evidence from Uruguay

While wealth accumulation and its distribution are arguably two of the key drivers of overall economic inequality, as well as being of major importance in their own right, very little is known about them in the developing world. I contribute to filling this gap by providing a micro–macro consistent series of aggregate wealth and its distribution in Uruguay. The country's balance sheet, which is not estimated by official institutions, is constructed for the first time by combining a wide array of data sources, leading to a book‐value wealth‐to‐income ratio of 450–500 percent. Private wealth distribution is then estimated based on the capitalization method, taking stock of combined survey‐tax‐national accounts micro‐data, resulting in a top 1 percent wealth share of 37–40 percent. Estimates are systematically compared with results based on the estate multiplier method, real estate wealth tax, household wealth survey, and Forbes billionaires list.

How to Tax Wealth

How to Tax Wealth

Recent Developments Regarding the Italy-Switzerland Income and Capital Tax Treaty (1976)

On 15 September 2023, for the first time in 15 years, the two IFA Italy and Switzerland branches organized a bilateral meeting concerning recent developments in their relationship. The first session addressed the latest progress on the Italy-Switzerland Income and Capital Tax Treaty (1976). This article aims to provide an overview of the treaty, focusing on its evolution and the hottest tax topics for the countries involved.

Wealth Tax

In this article, I defend a procedural justification for the wealth tax, and criticize what I have called the outcome-approach. On the outcome-approach, the wealth tax is justified on the ground that it is an effective means to achieve an outcome, or a state of affairs, that we might consider just. That outcome or state of affairs would be equality. I argue that this approach leads to unjust or unituitive results, as it burdens all agents equally, being the case that not all agents should be burdened equally. This is because it ignores the history of transactions that led to the creation of taxed wealth. The procedural approach that I defend, in contrast, looks both at the fairness of transactions, and the result they have generated, and is based on the idea that the wealth tax should burden some agents more than others, depending on whether or not they have met standards of fairness in the past. Those standards of fairness are basically exploitation, oppression, and structural injustice.

Deferred tax assets, earnings quality and their effects on bank results: Evidence from Brazil

Contextualização: Os Ativos Fiscais Diferidos (AFD) podem tornar a qualidade de lucros poluída pelo seu uso, pois, os lucros apresentados estarão inflados por esses ativos, resultantes de operações financeiras discricionárias. Objetivo: Esse estudo teve por objetivo identificar os efeitos dos AFD na perspectiva de qualidade de lucros dos bancos, sendo utilizadas as proxies persistência de lucros, alisamento de lucros e Earning Response Coefficient (ERC). Método: Os testes empíricos tiveram por base as informações dos relatórios financeiros dos bancos, Banco Central do Brasil (BACEN), Bloomberg e Economatica® de 2017 a 2021, sendo estimados por dados em painel. Resultados: Os resultados sugerem que, quanto maiores os AFD, maiores serão a persistência de lucros e os lucros inesperados pelo ERC e, menor será o alisamento de lucros. Conclusões: A perspectiva de qualidade de lucros exibida nos resultados evidencia a validação dos modelos propostos, contribuindo não somente para o tema AFD e a qualidade de lucros, mas, também, a associação do uso discricionário desses ativos como geradores de resultados poluidores dos bancos, sendo constatados, nesse estudo que, os médios apresentaram significância no uso dos AFD para a persistência de lucros, e os pequenos para a persistência e o alisamento de lucros, sendo beneficiados quanto às movimentações de empréstimos concedidos e de estoques de AFD, tornando-os mais persistentes e alisados ao longo do período amostral.

Strategic capital taxation, tradable emission permits and global pollution

AbstractThe paper considers a two‐country model with international capital mobility and production‐generated cross‐border pollution. It examines the effectiveness of alternative policy combinations consisting of capital taxes and nationally or internationally tradable emissions permits in reducing global pollution. The internationally mobile capital is taxed according to three different rules, namely, capital tax exemptions, capital tax credits and capital tax deductions. Our key result is that, under certain conditions, the lowest Nash equilibrium level of global pollution is achieved with a policy mix combining either capital tax exemptions or capital tax credits with internationally, rather than nationally, tradable emission permits.

Tax Evasion and Capital Taxation

Tax Evasion and Capital Taxation

Capital tax incentives and firm innovation: evidence from accelerated depreciation in China

PurposeThis study aims to investigate the influence and impact mechanism of capital tax incentives on firm innovation.Design/methodology/approachThis study employs the difference-in-differences (DID) method, in conjunction with the exogenous impact of accelerated depreciation (AD) pilot policy. This study selects Chinese listed companies from 2010 to 2017 as the research sample.FindingsFirstly, AD exerts a substantial positive effect on the quantity and quality of the innovation output of firms, and the positive impact results primarily from heightened investment in fixed assets, particularly, machinery and equipment. Secondly, the influence of the policy is pronounced in non-state-owned enterprises, mature enterprises, less capital-intensive enterprises and non-high-tech industries, which all exhibit strong innovation incentives. Lastly, the tax incentive policy significantly stimulates firm innovation in the short term, but its long-term impact on innovation incentives lacks statistical significance.Originality/valueThis study highlights the significance of capital tax incentives in facilitating the innovation process in firms.

Considering the Wealth Tax in the Context of the Wealth Declaration Debates (1960-1984) in Turkey

Considering the Wealth Tax in the Context of the Wealth Declaration Debates (1960-1984) in Turkey

Taxonomy of wealth taxation literature: A study of implementation, effects, responses and regulatory policy context

This paper presents a systematic review of wealth tax literature examining the challenges of wealth taxes for countries that have implemented and repealed them. We comprehensively analyzed 96 papers published in 14 reputable journals from 2000 to 2023. These papers are classified into three primary thematic areas: wealth tax implementation, effects of wealth tax (EWT), and taxpayer behavioral responses (BRT). We find that most countries that have implemented wealth taxes face challenges of accurate valuation of net worth (NW) and assets and high administrative costs (ADCs) due to the high ADCs associated with implementing and enforcing wealth taxes and double taxation. The implication of the results is to enhance understanding of the challenges influencing wealth tax implementation for researchers and policymakers and also bridge historical experiences into the present context, offering practical guidance for the United States of America (USA) states considering wealth tax adoption, thereby supporting their decision-making process.

Capital Taxation in the Middle of History

Capital Taxation in the Middle of History

The Steady-State Impacts of Automation and Capital Taxation

The Steady-State Impacts of Automation and Capital Taxation

Capital Taxation, Retained Earnings and Inequality: Evidence from Dividend Tax Reforms

Capital Taxation, Retained Earnings and Inequality: Evidence from Dividend Tax Reforms

Robust predictions in dynamic policy games

Dynamic policy games feature a wide range of equilibria. This paper provides a methodology for obtaining robust predictions. We focus on a model of sovereign debt, although our methodology applies to other settings, such as models of monetary policy or capital taxation. Our main result is a characterization of distributions over outcomes that are consistent with a subgame perfect equilibrium conditional on the observed history. We illustrate our main result by computing—conditional on an observed history—bounds across all equilibria on the maximum probability of a crisis: means, variances, and covariances over debt prices.

Wealth, Wealth Tax, and Wealth-y Tax

Wealth, Wealth Tax, and Wealth-y Tax

Behavioral Responses to Wealth Taxation: Evidence from a Norwegian Reform

Behavioral Responses to Wealth Taxation: Evidence from a Norwegian Reform

Book-Value Wealth Taxation, Capital Income Taxation, and Innovation

Book-Value Wealth Taxation, Capital Income Taxation, and Innovation

Behavioral Responses to Wealth Taxation: Evidence from Colombia

Behavioral Responses to Wealth Taxation: Evidence from Colombia

Wealth Tax Mobility and Tax Coordination

Wealth Tax Mobility and Tax Coordination