Estimating dynamic tax revenue elasticities for Germany
AbstractWe analyse tax revenue elasticities by applying dynamic models to a new disaggregated dataset for Germany, which is adjusted for the effects of tax reforms. We estimate long-run elasticities that are substantially lower than in comparable studies for profit-related taxes and are slightly lower for value-added taxes, whereas the long-run elasticity for wage taxes is close to the consensus estimate in the literature. Additionally, we find that differences between short- and long-run elasticities are particularly important with respect to profit-related taxes. Here we estimate a far lower contemporaneous response to tax base changes than other studies and a dynamic reaction pattern spanning several years, which can be explained, for example, by tax collection lags. --
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Bibliographic InfoPaper provided by Deutsche Bundesbank, Research Centre in its series Discussion Papers with number 23/2012.
Date of creation: 2012
Date of revision:
Dynamic tax revenue elasticities; Disaggregated analysis; Error correction models;
Find related papers by JEL classification:
- H2 - Public Economics - - Taxation, Subsidies, and Revenue
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
- H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
- E26 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Informal Economy; Underground Economy
This paper has been announced in the following NEP Reports:
- NEP-ACC-2012-10-20 (Accounting & Auditing)
- NEP-ALL-2012-10-20 (All new papers)
- NEP-PBE-2012-10-20 (Public Economics)
- NEP-PUB-2012-10-20 (Public Finance)
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