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Commodity Tax Competition Under Destination and Origin Principles Author info | Abstract | Publisher info | Download info | Related research | Statistics Lockwood, Ben
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This paper studies the effect of switching from the destination to the origin principle of taxation on non-cooperative commodity tax equilibrium. When taxes are constrained to uniformity across commodities, the switch has no effect. When differentiated taxes are allowed, the effects of the switch depend on whether countries are small or large. In both cases the switch imposes the requirement that taxes must be uniform across commodities within each country. In the second case there are two further effects of the switch: (i) the introduction of negative spillover effects from tax policy; and (ii) a change in incentives to manipulate the terms of trade. The switch does not necessarily lead to a fall in all tax rates.
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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number
733.
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Date of creation: Nov 1992Date of revision:
Handle: RePEc:cpr:ceprdp:733Contact details of provider: Postal: Centre for Economic Policy Research, 53--56 Great Sutton Street, London EC1V 0DG Phone: 44 - 20 - 7183 8801 Fax: 44 - 20 - 7183 8820
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Keywords: Border Controls ; Customs Union ; Destination and Origin Regimes ; Tax Competition ; Other versions of this item:
Find related papers by JEL classification: E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy F15 - International Economics - - Trade - - - Economic Integration
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