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University of Tübingen Working Papers in Economics and Finance >
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http://hdl.handle.net/10419/45467
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| Title: | | The optimal structure of commodity taxation in a monopoly with tax avoidance or evasion  |
| Authors: | | Goerke, Laszlo |
| Issue Date: | | 2011 |
| Series/Report no.: | | University of Tübingen working papers in economics and finance 8 |
| Abstract: | | If tax obligations are met, the balanced-budget substitution of an ad valorem tax on output for a specific tax not only raises a monopolist's production, but also represents a Pareto improvement. However, if tax avoidance or evasion is feasible and the marginal costs of such actions decline with the legal tax burden, a monopolist will respond to a balanced-budget substitution of an ad valorem tax for a specific tax by reducing output, while profits remain constant. Therefore, in the presence of tax avoidance or evasion activities a move towards specific taxation can represent a Pareto improvement. |
| Subjects: | | Ad valorem tax Monopoly Output Tax avoidance Tax evasion Specific tax |
| JEL: | | H21 H25 H26 |
| Persistent Identifier of the first edition: | | urn:nbn:de:bsz:21-opus-56027 |
| Document Type: | | Working Paper |
| Appears in Collections: | | University of Tübingen Working Papers in Economics and Finance
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