Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/71460 
Year of Publication: 
2003
Series/Report no.: 
IFS Working Papers No. 03/04
Publisher: 
Institute for Fiscal Studies (IFS), London
Abstract: 
This paper reviews how the impact of taxes on the incentive to invest in the corporate sector can be measured. The main focus of the paper is to discuss measures derived from economic theory. In empirical work, these tend to be based on the legal parameters of tax regimes, rather than on observed tax revenues or tax liabilities. A basic model is set up which yields two measures, reflecting two alternative forms of investment decision. An effective marginal tax rate is relevant for decisions concerning the scale of the capital stock. An effective average tax rate is relevant for discrete investment choices.
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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