Rent Taxes and Royalties in Designing Fiscal Regimes for Non-Renewable Resources
AbstractA fundamental issues in designing any fiscal regime for non-renewable resources is the balance between rent taxes and royalties. This paper reviews the core issues that arise, in terms of both efficient rent extraction and correcting various market failures. Issues of asymmetric information, for instance, can rationalize using both instruments. The paper also shows that, even though they effectively involve the choice of distinct parameters at several dates, rent taxes are not subject to the time consistency problem that is central to the extractive industries, but royalties are (although time consistent royalty policy is efficient conditional on initial resource stocks).
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Bibliographic InfoPaper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 4568.
Date of creation: 2014
Date of revision:
rent tax; royalties; resource taxation;
Find related papers by JEL classification:
- H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
- H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
- Q30 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2014-03-08 (All new papers)
- NEP-ENV-2014-03-08 (Environmental Economics)
- NEP-PBE-2014-03-08 (Public Economics)
- NEP-PUB-2014-03-08 (Public Finance)
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