Revenue-raising taxes: General equilibrium evaluation of alternative taxation in U.S. petroleum industries
Should the United States increase taxes and tariffs in the energy sector to reduce its federal deficit? This paper uses a twelve sector general equilibrium model to estimate the fiscal effects, and the effects on welfare and employment, of : (i) a 25 percent import tax on imported crude petroleum oil; (ii) a 15 percent excise tax on petroleum products; and (iii) a combination of the two. The excise tax would be the most efficient revenue raising instrument. The 25 percent import tariff would raise US$7.3 billion, while the 15 percent excise tax would raise US$35 billion. Moreover, each dollar raised through a tariff would come at a loss of 25 cents in welfare. Each dollar raised through an excise tax would come at a loss of only one cent in welfare. Acombination of excise taxes, subsidies, and import tariffs would be the least costly way (in terms of welfare) to raise US$20 billion. The optimal tax structure would involve a tariff and a small subsidy on petroleum products to counteract the distortion induced by a tax on oil - the most important input for petroleum products.
(This abstract was borrowed from another version of this item.)
If 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.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
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.:
- Harris, Richard G. & Mackinnon, James G., 1979. "Computing optimal tax equilibria," Journal of Public Economics, Elsevier, vol. 11(2), pages 197-212, March.
- Jaime de Melo & David Tarr, 2014.
"Welfare Costs Of U.S. Quotas In Textiles, Steel And Autos,"
World Scientific Book Chapters,
in: APPLIED TRADE POLICY MODELING IN 16 COUNTRIES Insights and Impacts from World Bank CGE Based Projects, chapter 2, pages 39-47
World Scientific Publishing Co. Pte. Ltd..
- de Melo, Jaime & Tarr, David, 1990. "Welfare Costs of U.S. Quotas in Textiles, Steel and Autos," The Review of Economics and Statistics, MIT Press, vol. 72(3), pages 489-97, August.
- de Melo, Jaime & Tarr, David, 1988. "Welfare costs of U.S. quotas on textiles, steel, and autos," Policy Research Working Paper Series 83, The World Bank.
- de Melo, Jaime & Tarr, David, 1990. "Welfare Costs of US Quotas in Textiles, Steel and Autos," CEPR Discussion Papers 401, C.E.P.R. Discussion Papers.
- Vern Caddy, 1976. "Empirical Estimation of the Elasticity of Substitution : A Review," Centre of Policy Studies/IMPACT Centre Working Papers op-09, Victoria University, Centre of Policy Studies/IMPACT Centre.
- Alan S. Manne, 1976. "ETA: A Model for Energy Technology Assessment," Bell Journal of Economics, The RAND Corporation, vol. 7(2), pages 379-406, Autumn.
- Dixit, Avinash, 1985. "Tax policy in open economies," Handbook of Public Economics, in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 1, chapter 6, pages 313-374 Elsevier.
When requesting a correction, please mention this item's handle: RePEc:eee:jpolmo:v:11:y:1989:i:3:p:425-449. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Shamier, Wendy)
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.