Economic Effects of a Personal Capital-Income Tax Add-On to a Flat Tax

John Diamond and George Zodrow ()

FinanzArchiv: Public Finance Analysis, 2007, vol. 63, issue 3, 374-395

Abstract: Although much academic and policy discussion has focused on replacing the income tax with a consumption-based tax, very few consumption-based direct tax reforms have been enacted. Much more common are approaches that reduce the level of capital-income taxation under an income tax, including the current Nordic dual income taxes and broadly similar approaches recently proposed in Germany, Switzerland, and the United States. This paper examines the general economic case for such reforms and then reports the results of a simulation of the economic effects of implementing such a capital-income add-on tax to a flat tax structure in the U.S.

Keywords: income tax reform; dual income tax; flat tax; add-on personal capital-income tax; dynamic modeling; overlapping-generations computable general-equilibrium model (search for similar items in EconPapers)
JEL-codes: H20 H24 H25 (search for similar items in EconPapers)
Date: 2007
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
https://www.mohrsiebeck.com/en/article/economic-ef ... 1628001522107x250113 (text/html)
Fulltext access is included for subscribers to the printed version.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:mhr:finarc:urn:sici:0015-2218(200709)63:3_374:eeoapc_2.0.tx_2-v

Ordering information: This journal article can be ordered from
Mohr Siebeck GmbH & Co. KG, P.O.Box 2040, 72010 Tübingen, Germany

DOI: 10.1628/001522107X250113

Access Statistics for this article

FinanzArchiv: Public Finance Analysis is currently edited by Alfons Weichenrieder, Ronnie Schöb and Jean-François Tremblay

More articles in FinanzArchiv: Public Finance Analysis from Mohr Siebeck, Tübingen
Bibliographic data for series maintained by Thomas Wolpert ().