This paper presents a simple two-country model with mobile capital and immobile labour, in which there are two classes of individuals, the workers and the capital owners. A source-based tax on capital income is used to finance transfers to workers. If the two countries are homogeneous in all...

This paper reviews the analytical and empirical evidence on certain issues in commodity tax design that have not received much attention. These include the impact on optimal commodity taxes of allowing the following: (i)non linear Engel curves, (ii)Household composition and child subsidy,...

With sufficiently well-reasoned and principled reform of tax systems, it is possible to achieve practical simplicity and a reduction in perverse incentives to a far greater degree than under any of the "flat-rate" proposals being advanced, without significant sacrifice of progressivity. But it...

The theorem of the zero taxation of capital income is reexamined and is shown to hinge critically on the assupmtions of a long horizon and perfect markets for the inter-temporal allocation of resources: (i) with additive preferences, and for any permanent tax rate, a reduction of this rate for a...