Capital income and profits taxation with foreign ownership of firms

Income Tax;Corporate Ownership;Profits Tax

A welfare comparison of international tax regimes with cross ownership of firms

welfare economics;taxation;corporate ownership

The Political Economy of Capital Income and Profit Taxation in a Small Open Economy

This paper considers the political economy of the mix of profit, investment and saving taxation in a small open economy where agents generally differ in their shares of profit and other income.In this setting, capital income taxation can have the dual role of financing government spending and of redistributing income.With majority voting, several different constellations of profit, investment and saving taxes can arise.The paper, for instance, can explain why distorting saving taxation exists, even if profits are not taxed to the fullest extent.Alternatively, saving may be subsidized, even if profit and investment are highly taxed.The role of the foreign ownership of domestic firms in explaining capital income taxation is examined for the two cases of majority voting and a representative agent.With majority voting, a higher foreign ownership may induce a shift towards higher profittaxation;political economy;open economy

The Coordination of Capital Income and Profit Taxation with Cross-Ownership of Firms

This paper investigates the scope for international coordination of capital income and profit taxation.The paper considers a world of many symmetric countries where public goods are financed by taxes on capital income and on profits.In the open economy, the authorities have at their disposal a residence-based saving tax, a source-based investment tax and a profit tax. Determinants of the tax mix are the foreign ownership of domestic firms, if any, and the extent to which the profit tax is feasible.Noncooperative tax policy in the open economy is compared to the corresponding tax policy in the closed economy where a single tax instrument determines the wedge between the returns to saving and investment.There generally is a scope for a coordinated increase in this tax wedge if the noncoordinated tax wedge is negative or very large, and vice versa.There is no need for tax coordination if there is no foreign ownership or if profits are taxed fully.The cases for tax coordination when in the noncoordinated scenario there either is no saving tax or no investment tax are also considered.corporate ownership;capital;incomes;profits tax

Privatization, public investment and capital income taxation

privatization;investment;income tax

The Political Economy of Capital Income and Profit Taxation in a Small Open Economy

This paper considers the political economy of the mix of profit, investment and saving taxation in a small open economy where agents generally differ in their shares of profit and other income.In this setting, capital income taxation can have the dual role of financing government spending and of redistributing income.With majority voting, several different constellations of profit, investment and saving taxes can arise.The paper, for instance, can explain why distorting saving taxation exists, even if profits are not taxed to the fullest extent.Alternatively, saving may be subsidized, even if profit and investment are highly taxed.The role of the foreign ownership of domestic firms in explaining capital income taxation is examined for the two cases of majority voting and a representative agent.With majority voting, a higher foreign ownership may induce a shift towards higher profit

The Coordination of Capital Income and Profit Taxation with Cross-Ownership of Firms

This paper investigates the scope for international coordination of capital income and profit taxation.The paper considers a world of many symmetric countries where public goods are financed by taxes on capital income and on profits.In the open economy, the authorities have at their disposal a residence-based saving tax, a source-based investment tax and a profit tax. Determinants of the tax mix are the foreign ownership of domestic firms, if any, and the extent to which the profit tax is feasible.Noncooperative tax policy in the open economy is compared to the corresponding tax policy in the closed economy where a single tax instrument determines the wedge between the returns to saving and investment.There generally is a scope for a coordinated increase in this tax wedge if the noncoordinated tax wedge is negative or very large, and vice versa.There is no need for tax coordination if there is no foreign ownership or if profits are taxed fully.The cases for tax coordination when in the noncoordinated scenario there either is no saving tax or no investment tax are also considered