Taxation, growth and welfare: Dynamic effects of Estonia’s 2000 income tax act

Abstract: This paper analyses the long-run effects of Estonia’s 2000 Income Tax Act with a dynamic general equilibrium model. Specifically, we consider the impact of the shift from an imputation system to one where companies only pay taxes on distributed profits. Balanced growth paths, transitional dynamics and welfare costs are computed. Our results indicate that the 2000 Income Tax Act leads to higher per capita income and investment, but lower welfare. A sensitivity analysis shows the results are rather robust.

Keywords: growth; welfare; taxation; tax reform; Estonia (search for similar items in EconPapers)
JEL-codes: H25 H32 O41 O52 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-pbe, nep-pub and nep-tra
Date: 2004-01-30
Note: Type of Document - pdf; prepared on Win98; pages: 26
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http://129.3.20.41/eps/mac/papers/0401/0401009.pdf (application/pdf)

Related works:
Working Paper: Taxation, Growth and Welfare: Dynamic Effects of Estonia´s 2000 Income Tax Act (2003)
Working Paper: Taxation, growth and welfare: Dynamic effects of Estonia’s 2000 income tax act (2007)
Journal Article: Taxation, Growth and Welfare: Dynamic Effects of Estonia's 2000 Income Tax Act (2006)
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