Despite the intensifying debate over the taxation of Internet commerce, the relevant issues have not been given a systematic treatment in the context of the literature on optimal taxation. This article presents such an analysis and investigates separately the taxation of business purchases of...

In the spirit of the elasticity of taxable income literature, which has primarily considered federal taxes using individual data, we estimate panel regressions of state personal income tax bases on state tax rates, structures, and other controls. We consider actual tax base data gathered...

This paper extends the quantitative estimates of sales tax revenue losses from electronic commerce in a variety of ways. First, we place the effects of e-commerce in the context of general sales tax base trends, arguing that e-commerce is only one of the factors reducing sales tax bases. Second,...

We examine the relative dynamic responses of state personal tax revenues and sales tax bases to changes in state personal income. Our econometric analysis, which includes separate analyses of long-run and short-run dynamics for each state, permits the estimation of asymmetric short-run responses...

Most arguments in favor of the Internet Tax Freedom Act (ITFA) assume that taxing Internet access would reduce Internet use. The authors investigate this possibility empirically, making use of panel data covering all U.S. states for the years 1998, 2000, and 2001. Statutory variation in the...

We identify how the cost of college shapes high school graduates’ choice of college state and sector by exploiting discontinuous eligibility criteria for broad-based merit scholarships in Tennessee. For students whose ACT is a decisive factor in their scholarship eligibility, reductions in...

We examine why and when some local governments choose to reach a legal sales tax rate maximum while others do not. We employ a duration model to study Tennessee local option sales taxes between 1975 and 1999. Our results show that between 1975 and 1984, counties with lower sales tax capacity...

A model is developed which focuses on the relationship between fiscal variables and industrial location. Industrial location decisions are hypothesized to be made within a system of supply and demand. On the supply side, communities determine the optimal level of industrial activity based on a...

Most countries, developed and developing, are fiscally decentralized with regional and local governments of varying importance. In many of these countries, some of these sub-national governments differ substantially from others in terms of wealth, ethnic, religious, or linguistic composition....