Measuring Tax Efficiency: A Tax Optimality Index
Copyright policy )Measuring Tax Efficiency: A Tax Optimality Index
This paper introduces an index of tax optimality thatmeasures the distance of some current tax structure from the optimal taxstructure in the presence of public goods. In doing so, we derive a [0, 1]number that reveals immediately how far the current tax configurationis from the optimal one and, thereby, the degree of efficiency of a taxsystem. We call this number the Tax Optimality Index. We show howthe basic method can be altered in order to derive a revenue equivalentuniform tax, which measures the size of the public sector. A numericalexample is used to illustrate the method developed.JEL Code: H21, H41.Keywords: Tax optimality index, excess burden, distance function.Authors Affiliations: Raimondos-Møller: Copenhagen Business School, CEPR,CESifo, and EPRU. Woodland: University of Sydney.
- Copenhagen Business School Denmark
- UNSW Sydney Australia
- Queensland University of Technology Australia
- Centre for Economic Policy Research United Kingdom
- University of Sydney Australia
tax optimality index, excess burden, distance function, Excess burden of taxation, 330, Indeksberegninger, distance function; excess burden; tax optimality index, distance function, Optimale Besteuerung, Skatteteori, Tax burden, Velfærdsøkonomi, Den offentlige sektor, tax optimality index, Skattepolitik, Excess Burden, TOI, ddc:330, Distance function, Tax Optimality Index, Skattetryk, H41, tax optimality index; excess burden; distance function, H21, Tax optimality index, excess burden, Steuertheorie, Theorie, Nytteteori, jel: jel:H41, jel: jel:H21
tax optimality index, excess burden, distance function, Excess burden of taxation, 330, Indeksberegninger, distance function; excess burden; tax optimality index, distance function, Optimale Besteuerung, Skatteteori, Tax burden, Velfærdsøkonomi, Den offentlige sektor, tax optimality index, Skattepolitik, Excess Burden, TOI, ddc:330, Distance function, Tax Optimality Index, Skattetryk, H41, tax optimality index; excess burden; distance function, H21, Tax optimality index, excess burden, Steuertheorie, Theorie, Nytteteori, jel: jel:H41, jel: jel:H21
selected citations These citations are derived from selected sources.This is an alternative to the "Influence" indicator, which also reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).3 popularity This indicator reflects the "current" impact/attention (the "hype") of an article in the research community at large, based on the underlying citation network.Average influence This indicator reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).Average impulse This indicator reflects the initial momentum of an article directly after its publication, based on the underlying citation network.Average
Citations provided by BIP!Popularity provided by BIP!