Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/107294
Authors: 
Koehne, Sebastian
Year of Publication: 
2015
Series/Report no.: 
CESifo Working Paper 5194
Abstract: 
This paper proposes a theory of commodity taxation in the presence of durable goods. Optimal commodity taxes depend on preference nonseparabilities between durable and nondurable consumption. In particular, the seminal Atkinson–Stigliz result fails and differential commodity taxes are optimal even when the utility function is separable between labor and consumption. An application to housing decisions implies that housing should face higher tax rates than nondurable consumption. Moreover, the theory justifies housing provisions in the income tax code.
Subjects: 
optimal taxation
commodity taxation
durable goods
pre-committed goods
Atkinson-Stiglitz result
JEL: 
D82
H21
Document Type: 
Working Paper

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