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Revenue-maximizing tax rates in personal income taxation in the presence of consumption taxes: a note

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Sanz Sanz, José Félix (2016) Revenue-maximizing tax rates in personal income taxation in the presence of consumption taxes: a note. Applied Economics Letters, 23 (8). pp. 571-575. ISSN 1466-4291

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Official URL: http://dx.doi.org/10.1080/13504851.2015.1088136




Abstract

This article computes revenue-maximizing tax rates in personal income taxes in the presence of consumption taxes. It finds that the traditional Laffer analysis, which neglects the effects of marginal tax rates on consumption, overestimates the magnitude of revenue-maximizing tax rates. The bias caused by this oversight is computed.


Item Type:Article
Uncontrolled Keywords:Marginal tax rates; Laffer curve; Consumption taxes; Tax revenue; tax behaviou.
Subjects:Social sciences > Economics > Public economy
Social sciences > Economics > Public finance
Social sciences > Economics > Microeconomics
JEL:D11, D61, H21, H24, H2, H31
ID Code:56292
Deposited On:11 Jul 2019 08:18
Last Modified:11 Jul 2019 10:08

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