Multi-stage Taxation by Subnational gGovernments: Welfare Effects

This paper analyzes multi-stage taxation by provinces in a federal country, using a two- good, two-province, two-stage successive differentiated-product symmetric oligopoly model, where each producer is located in a province and sells its product through exclusive retailers located in both provinces. Retailers compete for consumers a la Bertrand with differentiated products. The producer-retailer setup allows provincial governments to raise taxes on both upstream and downstream links of the value chain. We solve a simultaneous and non-cooperative tax competition problem, where (symmetric) provinces choose tax rates to maximize welfare subject to a revenue constraint. We Gnd that provinces set tax rates to either raise revenue at only one segment of the value chain or use a combination of upstream and downstream taxation. This choice is determined by the revenue requirement, the size of the market and the degree of downstream competition. We characterize and discuss each possible case. Comparing the results of this model with the Leviathan case (analyzed in a previous paper by the authors) where governments behave as revenue maximizers, we Gnd that there is a threshold on revenue requirement such that welfarist governments tend to behave qual- itatively similar to Leviathan governments when revenue need exceed the threshold: they both choose a combination of taxes if products have some degree of heterogeneity, whereas they rely on downstream taxation when products are homogeneous. This way we provide a rationale for raising taxes on successive taxation even when governments internalize the effect of successive taxation on welfare.Departamento de Economí

Multi-stage Taxation by Subnational gGovernments: Welfare Effects

This paper analyzes multi-stage taxation by provinces in a federal country, using a two- good, two-province, two-stage successive differentiated-product symmetric oligopoly model, where each producer is located in a province and sells its product through exclusive retailers located in both provinces. Retailers compete for consumers a la Bertrand with differentiated products. The producer-retailer setup allows provincial governments to raise taxes on both upstream and downstream links of the value chain. We solve a simultaneous and non-cooperative tax competition problem, where (symmetric) provinces choose tax rates to maximize welfare subject to a revenue constraint. We Gnd that provinces set tax rates to either raise revenue at only one segment of the value chain or use a combination of upstream and downstream taxation. This choice is determined by the revenue requirement, the size of the market and the degree of downstream competition. We characterize and discuss each possible case. Comparing the results of this model with the Leviathan case (analyzed in a previous paper by the authors) where governments behave as revenue maximizers, we Gnd that there is a threshold on revenue requirement such that welfarist governments tend to behave qual- itatively similar to Leviathan governments when revenue need exceed the threshold: they both choose a combination of taxes if products have some degree of heterogeneity, whereas they rely on downstream taxation when products are homogeneous. This way we provide a rationale for raising taxes on successive taxation even when governments internalize the effect of successive taxation on welfare.Departamento de Economí

Multi-stage taxation by subnational governments: Tax incidence and Leviathan taxation

This paper analyzes multi-stage taxation by provinces in a federal country, using a novel two-good, two-province, successive-oligopoly heterogeneous-product Bertrand competition model, where each producer is located in a province and sells its product through exclusive retailers located in both provinces. The producer-retailer setup allows provincial governments to raise taxes on upstream and downstream transactions. First, we analyze tax incidence results and emphasize the importance of the degree of downstream competition on the tax shifting. Second, we solve a non-cooperative revenue maximization problem and study the properties of the equilibrium taxes. We characterize the solution: either all tax rates are positive or one province drops one tax rate. This way, the full-tax solution dominates upstream and downstream taxation. Also, the non-cooperative solution implies over-taxation when compared with the cooperative solution.Este paper analiza impuestos en múltiples etapas recaudados por provincias en un país federal, utilizando un modelo novedoso de competencia en dos segmentos productor- minorista a la Bertrand con productos diferenciados, donde cada productor está ubicado en una provincia y vende en todo el país a través de sus distribuidores. Este modelo genera la posibilidad de que las provincias recauden en las dos etapas de transacciones. En primer lugar, se obtienen resultados de incidencia, enfatizando la importancia del grado de diferenciación sobre la traslación. En segundo lugar, se resuelve el problema de maximización de recaudación en un contexto no cooperativo y se estudian las propiedades de las alícuotas de equilibrio: las provincias utilizan todas las alícuotas o una de ellas descarta sólo una alícuota. La solución no cooperativa domina (en términos de recaudación) a los casos de impuestos al productor o a las ventas minoristas. Por otro lado, esta solución se caracteriza por imposición excesiva (respecto de un caso cooperativo).Departamento de Economí

Incidencia distributiva del sistema tributario argentino

This paper studies the distributive impact of the tax system in Argentina using the last two available Household Expenditure Surveys for 2004/05 and 2012/13. Calculations were made using both household per capita income and household per capita consumption as welfare indicators. By using household per capita income, the tax system puts relatively more pressure on both tails of the distribution, being approximately constant for the intermediate deciles. On the other hand, choosing per capita consumption as welfare indicator makes the tax system roughly proportional, with the exception of the last decile, where tax pressure becomes much higher. These differences on the results make clear the relevance of the chosen welfare indicator for tax incidence analysis.El trabajo estudia la incidencia distributiva del sistema tributario argentino (por impuesto y a nivel agregado) haciendo uso de las dos últimas Encuestas Nacionales de Gasto de los Hogares correspondientes a los años 2004/05 y 2012/13. Al utilizar el ingreso per cápita familiar como indicador de bienestar, se obtiene que el sistema tributario ejerce mayor presión en ambas colas de la distribución, siendo constante en los deciles intermedios. Por otro lado, si se utiliza el consumo per cápita familiar como indicador, la incidencia resulta proporcional con excepción del último decil, en donde aumenta considerablemente. De este modo se pone de manifiesto la relevancia del indicador de bienestar elegido a la hora de realizar un análisis de incidencia tributaria

Multi-stage taxation by subnational governments: Tax incidence and Leviathan taxation

This paper analyzes multi-stage taxation by provinces in a federal country, using a novel two-good, two-province, successive-oligopoly heterogeneous-product Bertrand competition model, where each producer is located in a province and sells its product through exclusive retailers located in both provinces. The producer-retailer setup allows provincial governments to raise taxes on upstream and downstream transactions. First, we analyze tax incidence results and emphasize the importance of the degree of downstream competition on the tax shifting. Second, we solve a non-cooperative revenue maximization problem and study the properties of the equilibrium taxes. We characterize the solution: either all tax rates are positive or one province drops one tax rate. This way, the full-tax solution dominates upstream and downstream taxation. Also, the non-cooperative solution implies over-taxation when compared with the cooperative solution.Este paper analiza impuestos en múltiples etapas recaudados por provincias en un país federal, utilizando un modelo novedoso de competencia en dos segmentos productor- minorista a la Bertrand con productos diferenciados, donde cada productor está ubicado en una provincia y vende en todo el país a través de sus distribuidores. Este modelo genera la posibilidad de que las provincias recauden en las dos etapas de transacciones. En primer lugar, se obtienen resultados de incidencia, enfatizando la importancia del grado de diferenciación sobre la traslación. En segundo lugar, se resuelve el problema de maximización de recaudación en un contexto no cooperativo y se estudian las propiedades de las alícuotas de equilibrio: las provincias utilizan todas las alícuotas o una de ellas descarta sólo una alícuota. La solución no cooperativa domina (en términos de recaudación) a los casos de impuestos al productor o a las ventas minoristas. Por otro lado, esta solución se caracteriza por imposición excesiva (respecto de un caso cooperativo).Departamento de Economí

Multi-stage taxation by subnational governments: welfare effects

This paper analyzes multi-stage taxation by provinces in a federal country, using a two- good, two-province, two-stage successive differentiated-product symmetric oligopoly model, where each producer is located in a province and sells its product through exclusive retailers located in both provinces. Retailers compete for consumers a la Bertrand with differentiated products. The producer-retailer setup allows provincial governments to raise taxes on both upstream and downstream links of the value chain. We solve a simultaneous and non-cooperative tax competition problem, where (symmet- ric) provinces choose tax rates to maximize welfare subject to a revenue constraint. We find that provinces set tax rates to either raise revenue at only one segment of the value chain or use a combination of upstream and downstream taxation. This choice is determined by the revenue requirement, the size of the market and the degree of downstream competition. We characterize and discuss each possible case. Comparing the results of this model with the Leviathan case (analyzed in a previous paper by the authors) where governments behave as revenue maximizers, we find that there is a threshold on revenue requirement such that welfarist governments tend to behave qual- itatively similar to Leviathan governments when revenue need exceed the threshold: they both choose a combination of taxes if products have some degree of heterogeneity, whereas they rely on downstream taxation when products are homogeneous. This way we provide a rationale for raising taxes on successive taxation even when governments internalize the effect of successive taxation on welfare.Facultad de Ciencias Económica

Multi-stage Taxation by Subnational gGovernments: Welfare Effects

This paper analyzes multi-stage taxation by provinces in a federal country, using a two- good, two-province, two-stage successive differentiated-product symmetric oligopoly model, where each producer is located in a province and sells its product through exclusive retailers located in both provinces. Retailers compete for consumers a la Bertrand with differentiated products. The producer-retailer setup allows provincial governments to raise taxes on both upstream and downstream links of the value chain. We solve a simultaneous and non-cooperative tax competition problem, where (symmetric) provinces choose tax rates to maximize welfare subject to a revenue constraint. We Gnd that provinces set tax rates to either raise revenue at only one segment of the value chain or use a combination of upstream and downstream taxation. This choice is determined by the revenue requirement, the size of the market and the degree of downstream competition. We characterize and discuss each possible case. Comparing the results of this model with the Leviathan case (analyzed in a previous paper by the authors) where governments behave as revenue maximizers, we Gnd that there is a threshold on revenue requirement such that welfarist governments tend to behave qual- itatively similar to Leviathan governments when revenue need exceed the threshold: they both choose a combination of taxes if products have some degree of heterogeneity, whereas they rely on downstream taxation when products are homogeneous. This way we provide a rationale for raising taxes on successive taxation even when governments internalize the effect of successive taxation on welfare.Departamento de Economí

Incidencia distributiva del sistema tributario argentino

El trabajo estudia la incidencia distributiva del sistema tributario argentino (por impuesto y a nivel agregado) haciendo uso de las dos últimas Encuestas Nacionales de Gasto de los Hogares correspondientes a los años 2004/05 y 2012/13. Al utilizar el ingreso per cápita familiar como indicador de bienestar, se obtiene que el sistema tributario ejerce mayor presión en ambas colas de la distribución, siendo constante en los deciles intermedios. Por otro lado, si se utiliza el consumo per cápita familiar como indicador, la incidencia resulta proporcional con excepción del último decil, en donde aumenta considerablemente. De este modo se pone de manifiesto la relevancia del indicador de bienestar elegido a la hora de realizar un análisis de incidencia tributaria

Ejercicios de Finanzas Públicas

Este libro tiene como objetivo el desarrollo de ejercicios prácticos como complemento del estudio de los temas teóricos de un curso introductorio de finanzas públicas. Los ejercicios desarrollados incluyen temas de bienes públicos, externalidades, decisiones colectivas, distribución del ingreso, seguros sociales, provisión pública de bienes privados, cuestiones tributarias, federalismo fiscal y aspectos macroeconómicos.Facultad de Ciencias Económica

El Impuesto al Valor Agregado en Argentina. Consideraciones sobre su incidencia distributiva y propuestas de reforma

This paper studies the distributive incidence of Value Added Tax (VAT) in Argentina using the National Survey of Household Spending (ENGHo) for the years 2012 - 2013 and analyzes different alternatives for tax reform. It examines the potential effects of reforms that convert VAT into a uniform tax rate, combined with different repayment mechanisms, via transfers to the most vulnerable sectors of the population. The results obtained indicate that the VAT is regressive using the per capita family income as an indicator of well-being, but practically proportional using the per capita consumption of the family. Differential treatments of the current scheme, generally associated with equity reasons, do not improve income distribution. The reform proposals presented here are distributively favorable compared to the current situation.Este trabajo estudia la incidencia distributiva del Impuesto al Valor Agregado (IVA) en Argentina utilizando la Encuesta Nacional de Gasto de los Hogares (ENGHo) de los años 2012 - 2013 y analiza diferentes alternativas de reforma sobre dicho impuesto. Se estudian los efectos potenciales de reformas que conviertan al IVA en un impuesto de alícuota uniforme, combinado con distintos mecanismos de devolución, vía transferencias hacia los sectores más vulnerables de la población. Los resultados obtenidos señalan que el IVA resulta regresivo utilizando el ingreso per cápita familiar como indicador de bienestar, pero prácticamente proporcional utilizando el consumo per cápita familiar. Los tratamientos diferenciales del esquema vigente, generalmente asociados a razones de equidad, no mejoran la distribución del ingreso. Las propuestas de reforma planteadas aquí resultan distributivamente favorables en comparación con la situación actual