Generalised R-based and S-based taxes under uncertainty
AbstractThis paper considers the relationship between two general neutral business tax structures, which we label the ÃÂ¦irm tax' and the ÃÂ³hareholder taxÃÂ® The well-known R-based and S-based cash flow taxes, analysed by Meade (1978), are special cases of these two taxes. We demonstrate the neutrality of both taxes in the presence of uncertainty, and characterise the tax rules required in the event of default and wind-up. Our analysis provides the first proof of the neutrality of the S-based cash flow tax and the Allowance for Corporate Equity (ACE) corporation tax under uncertainty. We also discuss implementation and tax avoidance issues.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Public Economics.
Volume (Year): 87 (2003)
Issue (Month): 5-6 (May)
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Web page: http://www.elsevier.com/locate/inca/505578
Other versions of this item:
- Steve Bond & Michael Devereux, 1999. "Generalised R-based and S-based taxes under uncertainty," IFS Working Papers W99/09, Institute for Fiscal Studies.
- H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
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