Strategic Fiscal Interdependence: County And Municipal Adoptions Of Local Option Sales Taxes
AbstractThis study contributes to the tax competition literature by investigating the determinants of local option sales tax (LOST) adoptions using a model that simultaneously accounts for the presence of horizontal and vertical fiscal interactions. We use discrete time Cox Proportional Hazard regressions to study adoption patterns for county and municipal LOSTs in an environment where municipalities were authorized to implement LOSTs nearly two decades before counties. Controlling for factors measuring fiscal stress and the jurisdiction’s ability to export its taxes, we demonstrate that both vertical and horizontal fiscal spillovers play an important role in characterizing the strategic interdependence of local governments when they tax a common retail sales base.
Download InfoIf 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.
Bibliographic InfoArticle provided by National Tax Association in its journal National Tax Journal.
Volume (Year): 65 (2012)
Issue (Month): 2 (June)
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.:
- Feldstein, Martin S & Metcalf, Gilbert E, 1987.
"The Effect of Federal Tax Deductibility on State and Local Taxes and Spending,"
Journal of Political Economy, University of Chicago Press,
University of Chicago Press, vol. 95(4), pages 710-36, August.
- Metcalf, Gilbert & Feldstein, Martin, 1987. "The Effect of Federal Tax Deductibility on State and Local Taxes and Spending," Scholarly Articles 2766699, Harvard University Department of Economics.
- Martin Feldstein & Gilbert Metcalf, 1986. "The Effect of Federal Tax Deductibility on State and Local Taxes and Spending," NBER Working Papers 1791, National Bureau of Economic Research, Inc.
- Case, Anne C. & Rosen, Harvey S. & Hines, James Jr., 1993. "Budget spillovers and fiscal policy interdependence : Evidence from the states," Journal of Public Economics, Elsevier, Elsevier, vol. 52(3), pages 285-307, October.
- Anderson, Nathan B., 2006. "Beggar Thy Neighbor? Property Taxation of Vacation Homes," National Tax Journal, National Tax Association, National Tax Association, vol. 59(4), pages 757-80, December.
- Zimmerman, Jerold L., 1983. "Taxes and firm size," Journal of Accounting and Economics, Elsevier, Elsevier, vol. 5(1), pages 119-149, April.
- Johannes Rincke, 2009. "Yardstick competition and public sector innovation," International Tax and Public Finance, Springer, Springer, vol. 16(3), pages 337-361, June.
- Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 64, pages 416.
- Zodrow, George R., 2001. "The Property Tax as a Capital Tax: A Room with Three Views," National Tax Journal, National Tax Association, National Tax Association, vol. 54(n. 1), pages 139-56, March.
- Ashworth, John & Geys, Benny & Heyndels, Bruno, 2006. "Determinants of tax innovation: The case of environmental taxes in Flemish municipalities," European Journal of Political Economy, Elsevier, Elsevier, vol. 22(1), pages 223-247, March.
- Mieszkowski, Peter & Zodrow, George R, 1989. "Taxation and the Tiebout Model: The Differential Effects of Head Taxes, Taxes on Land Rents, and Property Taxes," Journal of Economic Literature, American Economic Association, American Economic Association, vol. 27(3), pages 1098-1146, September.
- Poterba, James M., 1996. "Retail Price Reactions to Changes in State and Local Sales Taxes," National Tax Journal, National Tax Association, National Tax Association, vol. 49(2), pages 165-76, June.
- Fischel, William A, 1992. "Property Taxation and the Tiebout Model: Evidence for the Benefit View from Zoning and Voting," Journal of Economic Literature, American Economic Association, American Economic Association, vol. 30(1), pages 171-77, March.
- David Agrawal, 2014. "Lost in America: Evidence on Local Sales Taxes from National Panel Data," CESifo Working Paper Series, CESifo Group Munich 4943, CESifo Group Munich.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Charmaine Wright).
If references are entirely missing, you can add them using this form.