Up or Down? Capital Income Taxation in the United States and the United Kingdom
Empirical evidence suggests that the Effective Marginal Tax Rate (EMTR) on income from capital has increased considerably in both the United States and the United Kingdom during 1982-2005. The corporate tax literature predicts however that the EMTR should fall over time due to increasing international capital mobility and higher tax competition between governments. This paper argues that this inconsistency can be explained by the fact that EMTRs are currently computed from versions of the neoclassical investment model that omit deferred tax constraints faced by firms investing in both the United States and the United Kingdom.
Volume (Year): 68 (2012)
Issue (Month): 1 (March)
|Contact details of provider:|| Web page: https://www.mohr.de/fa|
|Order Information:|| Postal: Mohr Siebeck GmbH & Co. KG, P.O.Box 2040, 72010 Tübingen, Germany|
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.:
- Harry Garretsen & Jolanda Peeters, 2007. "Capital Mobility, Agglomeration and Corporate Tax Rates: Is the Race to the Bottom for Real?," CESifo Economic Studies, CESifo, vol. 53(2), pages 263-293, June.
- de Mooij, Ruud A & Ederveen, Sjef, 2003.
"Taxation and Foreign Direct Investment: A Synthesis of Empirical Research,"
International Tax and Public Finance,
Springer, vol. 10(6), pages 673-93, November.
- Ruud de Mooij & S. Ederveen, 2001. "Taxation and foreign direct investment; a synthesis of empirical research," CPB Discussion Paper 3, CPB Netherlands Bureau for Economic Policy Analysis.
- Ruud A. de Mooij & Sjef Ederveen, 2001. "Taxation and Foreign Direct Investment: A Synthesis of Empirical Research," CESifo Working Paper Series 588, CESifo Group Munich.
- Backus, David & Henriksen, Espen & Storesletten, Kjetil, 2008.
"Taxes and the global allocation of capital,"
Journal of Monetary Economics,
Elsevier, vol. 55(1), pages 48-61, January.
- Wilson, John Douglas, 1999. "Theories of Tax Competition," National Tax Journal, National Tax Association, vol. 52(n. 2), pages 269-304, June.
- Kanniainen, Vesa & Sodersten, Jan, 1995. "The importance of reporting conventions for the theory of corporate taxation," Journal of Public Economics, Elsevier, vol. 57(3), pages 417-430, July.
- Michael P. Devereux & Rachel Griffith & Alexander Klemm, 2002. "Corporate income tax reforms and international tax competition," Economic Policy, CEPR;CES;MSH, vol. 17(35), pages 449-495, October.
- Devereux, Michael P. & Lockwood, Ben & Redoano, Michela, 2002.
"Do Countries Compete over Corporate Tax Rates?,"
CEPR Discussion Papers
3400, C.E.P.R. Discussion Papers.
- Devereux, Michael P & Lockwood, Ben & Redoano, Michela, 2002. "Do Countries Compete Over Corporate Tax Rates?," The Warwick Economics Research Paper Series (TWERPS) 642, University of Warwick, Department of Economics.
- Vito Polito, 2009. "Measuring the Effective Tax Burden in the Real World," Fiscal Studies, Institute for Fiscal Studies, vol. 30(2), pages 247-278, 06.
- Boadway, R. W. & Bruce, N., 1979. "Depreciation and interest deductions and the effect of the corporation income tax on investment," Journal of Public Economics, Elsevier, vol. 11(1), pages 93-105, February.
- Devereux, Michael P & Griffith, Rachel, 2003.
"Evaluating Tax Policy for Location Decisions,"
International Tax and Public Finance,
Springer, vol. 10(2), pages 107-26, March.
- Clemens Fuest & Bernd Huber & Jack Mintz, 2003. "Capital Mobility and Tax Competition: A Survey," CESifo Working Paper Series 956, CESifo Group Munich.
- King, Mervyn A, 1974. "Taxation and the Cost of Capital," Review of Economic Studies, Wiley Blackwell, vol. 41(1), pages 21-35, January.
- Kanniainen, Vesa & Sodersten, Jan, 1994. "Costs of monitoring and corporate taxation," Journal of Public Economics, Elsevier, vol. 55(2), pages 307-321, October.
- M. Bordignon & S. Giannini & P. Panteghini, 1998. "Corporate Taxation in Italy: an Analysis of the 1998 Reform," Working Papers 328, Dipartimento Scienze Economiche, Universita' di Bologna.
- Mervyn A. King & Don Fullerton, 1984. "The Taxation of Income from Capital: A Comparative Study of the United States, the United Kingdom, Sweden, and Germany," NBER Books, National Bureau of Economic Research, Inc, number king84-1, July.
When requesting a correction, please mention this item's handle: RePEc:mhr:finarc:urn:sici:0015-2218(201203)68:1_48:uodcit_2.0.tx_2-a. 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: (Thomas Wolpert)
If references are entirely missing, you can add them using this form.