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Incidencia fiscal de los incentivos tributarios
[Fiscal Incidence of tax incentives]

Author

Listed:
  • Ortega, Juan Ricardo
  • Piraquive, Gabriel Armando
  • Hernandez, Gustavo Adolfo
  • Soto, Carolina
  • Prada, Sergio
  • Ramirez, Juan Mauricio

Abstract

Tax incentives have traditionally been used as a tool by public policy makers in order to correct or reduce market failures. However, there is a widespread debate, in the international literature, about whether they can or not reaching this goal. In this paper, we propose a methodology to assess different tax incentives proposals using several criteria. We use a computable general equilibrium model for that purpose. Our main result is that in order for tax incentives to meet their goals, there needs to be a clear mechanism in the economy by which resources not received by the government become new private investment. However, it is a complex situation for governments, insofar as ensuring the reinvestment of the forgone resources would require additional governmental intervention, which are difficult to control and involve higher costs in administrative, fiscal and efficiency terms.

Suggested Citation

  • Ortega, Juan Ricardo & Piraquive, Gabriel Armando & Hernandez, Gustavo Adolfo & Soto, Carolina & Prada, Sergio & Ramirez, Juan Mauricio, 2000. "Incidencia fiscal de los incentivos tributarios [Fiscal Incidence of tax incentives]," MPRA Paper 14016, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:14016
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    References listed on IDEAS

    as
    1. Shoven,John B. & Whalley,John, 1992. "Applying General Equilibrium," Cambridge Books, Cambridge University Press, number 9780521266550, January.
    2. Lora, Eduardo, 1996. "Los modelos de equilibrio general computable en análisis de incidencia fiscal," Series Históricas 9729, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
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    Cited by:

    1. Thomas F. RUTHERFORD & Miles K. LIGHT & Gustavo Adolfo HERNANDEZ, 2002. "A dynamic general equilibrium model for tax policy analysis in Colombia," Archivos de Economía 1910, Departamento Nacional de Planeación.
    2. Mauricio SANTAMARÍA SALAMANCA, 2001. "External Trade, Skill, Technology and the recent increase of income inequality in Colombia," Archivos de Economía 2705, Departamento Nacional de Planeación.
    3. Thomas F. Rutherford & Miles K. LIGHT, 2002. "A General Equilibrium Model for Tax Policy Analysis in Colombia: The MEGATAX Model," Archivos de Economía 11291, Departamento Nacional de Planeación.
    4. Allan DRAZEN & Marcela ESLAVA, 2003. "The political business cycle in Colombia on the National and Regional level," Archivos de Economía 3616, Departamento Nacional de Planeación.
    5. Jaime Andrés ESTRADA, 2002. "Optimal enforcement: Finding the right balance," Archivos de Economía 3302, Departamento Nacional de Planeación.
    6. Hugo A. Macías Cardona & Luis Fernando Agudelo Henao & Mario Ricardo López Ramírez, 2008. "Los Métodos Para Medir La Evasión De Impuestos: Una Revisión," Observatorio de la Economía Latinoamericana, Servicios Académicos Intercontinentales SL. Hasta 31/12/2022, issue 92, february.
    7. Fernando MESA PARRA, 2001. "Strategic Trade Policy and Exchange Rate Uncertainty," Archivos de Economía 3527, Departamento Nacional de Planeación.
    8. Isidro Hernández Rodríguez, 2015. "Economía política de la tributación en Colombia," Books, Universidad Externado de Colombia, Facultad de Economía, edition 1, number 70.
    9. Diego F. Angel‐Urdinola & Quentin Wodon, 2004. "The Impact on Inequality of Raising the Minimum Wage: Gap‐narrowing and Reranking Effects," LABOUR, CEIS, vol. 18(2), pages 317-327, June.
    10. Enrique PINZON GARCIA & Oscar M. VALENCIA ARANA, 2006. "The Determinants of Colombian Firm´s Debt-Asset Ratio (1997-2003)," Archivos de Economía 3582, Departamento Nacional de Planeación.
    11. Maria Otilia Orozco, 2005. "Colombia's Higher Education Quality Control System and Potential for Further Development," Archivos de Economía 2139, Departamento Nacional de Planeación.
    12. Marcela Mel√©ndez & Katja Seim & Pablo Medina, 2003. "Productivity Dynamics Of The Colombian Manufacturing Sector," Documentos CEDE 3390, Universidad de los Andes, Facultad de Economía, CEDE.
    13. Diego F. ANGEL URDINOLA & Quentin WODON, 2003. "Relative labor supply and the gender wage Gap: Evidence for Colombia and the United States," Archivos de Economía 3452, Departamento Nacional de Planeación.
    14. Paula ACOSTA MARQUEZ, 2002. "Does corporate governance matter for developing countries? An overview of the Mexican case," Archivos de Economía 2380, Departamento Nacional de Planeación.
    15. José Daniel REYES PENA, 2003. "The cost of disinflation in Colombia: -A sacrifice Ratio Approach-," Archivos de Economía 3579, Departamento Nacional de Planeación.
    16. Carlos Alberto CASTRO IRAGORRI, 2003. "Yet another lagging, coincident and leading index for the Colombian economy," Archivos de Economía 3785, Departamento Nacional de Planeación.
    17. Diego F. ANGEL-URDINOLA, 2004. "A Minimum Wage Increase Can Have an Adverse Distributional Impact:The case of Colombia," Archivos de Economía 1922, Departamento Nacional de Planeación.

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    Keywords

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    JEL classification:

    • H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models

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