Efficiency Effects on the U.S. Economy from Wireless Taxation
This paper measures for the first time the economic efficiency effects of the taxation of wireless services, which are taxed by federal, state, and local governments at relatively high rates in the range of 14%-25%. The paper concludes such taxes are a much greater drain on the economy than their direct costs. The taxes identified in this paper cost the economy $2.56 billion more than the $4.79 billion they raise in tax revenues. These taxes are raised from wireless consumers and thereby suppress demand for service, imposing an efficiency loss on the economy of $0.53 for every $1 currently raised in taxes. Prospective taxes will impose an efficiency loss of $0.72-$1.14 per additional dollar of tax revenue raised.
|Date of creation:||Aug 1999|
|Date of revision:|
|Publication status:||published as Hausman, Jerry. "Efficiency Effects On The U.S. Economy From Wireless Taxation," National Tax Journal, 2000, v53(3,Sep), Part 2, 733-942.|
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- Jerry Hausman, 1997.
"Cellular Telephone, New Products and the CPI,"
NBER Working Papers
5982, National Bureau of Economic Research, Inc.
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- Martin Feldstein, 1999.
"Tax Avoidance And The Deadweight Loss Of The Income Tax,"
The Review of Economics and Statistics,
MIT Press, vol. 81(4), pages 674-680, November.
- Martin Feldstein, 1995. "Tax Avoidance and the Deadweight Loss of the Income Tax," NBER Working Papers 5055, National Bureau of Economic Research, Inc.
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