Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/153197
Authors: 
Wolswijk, Guido
Year of Publication: 
2007
Series/Report no.: 
ECB Working Paper 763
Abstract: 
This paper provides estimates for the base elasticities of Dutch taxes, paying particular attention to differences between short-and long-term elasticities, and allowing for asymmetric adjustment. Estimates are presented for five tax categories for the period 1970-2005, after making appropriate corrections for effects of discretionary tax measures. The empirical results indicate that shortterm elasticities often are lower than long-term ones, notably when taxes are subdued. Consequently, shocks to tax revenues tend to be aggravated by the dynamics of short-term elasticities. Ignoring differences between short- and long-term elasticities contributes to revenue ‘surprises’ and an incorrect assessment of the fiscal stance.
Subjects: 
fiscal indicators
income elasticity
Tax revenue
The Netherlands
JEL: 
H2
H62
H68
Document Type: 
Working Paper

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