Advanced Search
MyIDEAS: Login to save this article or follow this journal

Paying for public spending: is there a role for earmarked taxes?

Contents:

Author Info

  • Margaret Wilkinson
Registered author(s):

    Abstract

    Tax earmarking, or hypothecation, refers to the assigning of receipts either from a single tax base, or as a proportion from a wider pool of revenue, to a specific end use; it contrasts with general fund financing of expenditure from consolidated receipts. The idea has been seized on both by those who want to defend the public sector who think it would make taxation popular and by those who want to cut public spending who expect the opposite effect. Earmarking may be applied in a strong or substantive sense, or in a weak or nominal sense. In the strong case, revenue determines expenditure, or at least revenue must match expenditure, and there may be associated referendums on the amount of spending and the tax rate. In the weak case, earmarking is purely formal — undertaken to make the system more transparent and to inform the taxpayer of the cost of a service. Earmarking may also be wide, covering a whole spending programme, or narrow, for a specific project within a programme. The principal example of earmarking (nominal) in the UK today is National Insurance contributions (NICs) which go to the National Insurance Fund out of which contributory benefits are paid. This paper considers the range of support for earmarked taxes, examines the issues, and asks if there is a role for such taxes in the British system.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www.ifs.org.uk/fs/articles/wilkinson_nov94.pdf
    Download Restriction: no

    Bibliographic Info

    Article provided by Institute for Fiscal Studies in its journal Fiscal Studies.

    Volume (Year): 15 (1994)
    Issue (Month): 4 (November)
    Pages: 119-35

    as in new window
    Handle: RePEc:ifs:fistud:v:15:y:1994:i:4:p:119-35

    Contact details of provider:
    Postal: The Institute for Fiscal Studies 7 Ridgmount Street LONDON WC1E 7AE
    Phone: (+44) 020 7291 4800
    Fax: (+44) 020 7323 4780
    Email:
    Web page: http://www.ifs.org.uk
    More information through EDIRC

    Order Information:
    Postal: The Institute for Fiscal Studies 7 Ridgmount Street LONDON WC1E 7AE
    Email:

    Related research

    Keywords:

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Rivlin, Alice M, 1989. "The Continuing Search for a Popular Tax," American Economic Review, American Economic Association, American Economic Association, vol. 79(2), pages 113-17, May.
    2. James M. Buchanan, 1963. "The Economics of Earmarked Taxes," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 71, pages 457.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as in new window

    Cited by:
    1. John C. V. Pezzey, 2002. "EmissionTaxes and Tradable Permits: A Comparison of views on Long Run Efficiency," Economics and Environment Network Working Papers, Australian National University, Economics and Environment Network 0210, Australian National University, Economics and Environment Network.
    2. Guillem López i Casasnovas & David Casado i Marín, . "Análisis prospectivo de la oferta de servicios públicos en España," Studies on the Spanish Economy 28, FEDEA.
    3. Sclen, HÃ¥kon & Kallbekken, Steffen, 2011. "A choice experiment on fuel taxation and earmarking in Norway," Ecological Economics, Elsevier, Elsevier, vol. 70(11), pages 2181-2190, September.
    4. Richard Bird & Joosung Jun, 2005. "Earmarking in Theory and Korean Practice," International Center for Public Policy Working Paper Series, at AYSPS, GSU, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University paper0515, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    5. Ergas, Henry, 2010. "New policies create a new politics: issues of institutional design in climate change policy," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, Australian Agricultural and Resource Economics Society, vol. 54(2), June.
    6. Bos, Dieter, 2000. "Earmarked taxation: welfare versus political support," Journal of Public Economics, Elsevier, Elsevier, vol. 75(3), pages 439-462, March.
    7. Pezzey, John C.V., 2001. "Distributing the Value of a Country’s Tradeable Carbon Permits," 2001 Conference (45th), January 23-25, 2001, Adelaide, Australian Agricultural and Resource Economics Society 125832, Australian Agricultural and Resource Economics Society.
    8. Dieter Bös, 1999. "Earmarked Taxation: Welfare versus Political Support," CESifo Working Paper Series 207, CESifo Group Munich.
    9. Neva Novarro, 2004. "Do Policy-Makers Earmark to Constrain their Successors? The Case of Environmental Earmarking," Working Papers, College of the Holy Cross, Department of Economics 0408, College of the Holy Cross, Department of Economics.

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:ifs:fistud:v:15:y:1994:i:4:p:119-35. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Stephanie Seavers).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.