Capital Tax Incidence: Fisherian Impressions from the Time Series
- Topics:
- Taxes
- Tags:
- Capital Taxation,
- Finance,
- Financial Planning,
- Free Trade,
- Taxes
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Overview: This paper accepts for the sake of argument the hypothesis that much of the time series correlation between tax and profit rates is spurious. Discussion in the paper shows how nonetheless time series for profit rates, tax rates, and consumption can be organized, compared and interpreted using Fisher's (1930) theory of consumption in order to understand the incidence of capital taxes. Capital taxation is associated with a wedge between anticipated aggregate consumption growth and capital rental rates, suggesting that in one way or another capital owner behavior adjusts in the direction needed for some passing' of the capital tax. Refer article for more elaboration.
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Format: PDF | Size: 604KB | Date: Aug 2003 | Pages: 109
