Towards a Theory of the Direct-Indirect Tax Mix

Arbeitspapier

Despite the fact that all developed economies levy broadly-based indirect taxes alongside direct taxes, little theory is devoted to explaining the direct-indirect tax mix. Our purpose is to show that if different taxes have different evasion characteristics, some optimal tax mix emerges naturally. Assuming that only income tax can be evaded and focusing on a two-class economy, we analyze the case for supplementing optimal(nonlinear) income taxation with commodity taxation, and we develop conditions under which the latter should or should not be uniform.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Queen's Economics Department Working Paper ; No. 853

Classification and Topics

• Classification: Wirtschaft ; Taxation and Subsidies: Efficiency; Optimal Taxation ; Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes ; Tax Evasion and Avoidance

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Boadway, Robin ; Marchand, Maurice ; Pestieau, Pierre
• Event: Veröffentlichung
• (who): Queen's University, Department of Economics
• (where): Kingston (Ontario)
• (when): 1992

Further information

• Handle: http://hdl.handle.net/10419/189177
• Last update: 10.03.2025, 11:45 AM CET