Do High Taxes Lock-in Capital Gains? Evidence from a Flat Rate Tax System
AbstractThe purpose of this paper is to study, using a comprehensive Swedish panel data set, whether investors are less willing to realize capital gains when the marginal tax rate on capital gains is relatively high. In Sweden capital gains are taxed independently of ordinary income at a flat rate, making it possible to avoid endogenity problems and to include direct measures of capital gains taxation in the empirical analysis. The results indicate that a 10% increase in capital gains tax rate reduces the number of realizations of capital gains with 8.7% and the realized amount, given the decision to realize, with 1.9%. In addition, wealthy individuals seem to respond more to changes in capital gains tax rates than less-wealthy individuals.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoPaper provided by HUI Research in its series HUI Working Papers with number 6.
Length: 25 pages
Date of creation: 31 Jan 2007
Date of revision:
Publication status: Published as Daunfeldt, Sven-Olov, Ulrika Praski-Ståhlgren and Niklas Rudholm, 'Do High Taxes Lock-in Capital Gains? Evidence from a Flat Rate Tax System' in Public Choice, 145, 25-38, 2010., 2010, pages 14.
Contact details of provider:
Postal: HUI Research, Regeringsgatan 60, 103 29 Stockholm, Sweden
Phone: +46 (0)8 762 72 80
Fax: +46 (0)8 679 76 06
Web page: http://www.hui.se/
More information through EDIRC
Capital gains realizations; tax avoidance; panel data;
Find related papers by JEL classification:
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
- H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
This paper has been announced in the following NEP Reports:
- NEP-ACC-2007-03-03 (Accounting & Auditing)
- NEP-ALL-2007-03-03 (All new papers)
- NEP-EEC-2007-03-03 (European Economics)
- NEP-PBE-2007-03-03 (Public Economics)
- NEP-PUB-2007-03-03 (Public Finance)
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Pietola, Kyosti & Myyra, Sami & Pouta, Eija, 2009.
"Fiscal and trade distorting effects of capital gains tax on land sales - empirical evidence from agricultural land market in Finland,"
50040, MTT Agrifood Research Finland.
- Pietola, Kyosti & Myyra, Sami & Pouta, Eija, 2009. "Fiscal and trade distorting effects of capital gains tax on land sales - empirical evidence from agricultural land market in Finland," 2009 Conference, August 16-22, 2009, Beijing, China 50953, International Association of Agricultural Economists.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Helena Nilsson).
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.