Tax Deductibility of Commuting Expenses and Residential Land Use with more than one Center
Matthias Wrede ()
No 972, CESifo Working Paper Series from CESifo Group Munich
This paper analyzes the treatment of commuting expenses by the income tax code from a normative and a positive point of view within a continuous space framework with endogenous residence choices and perfect labor mobility. As commuting expenses should never be deductible from the income tax base in a first-best world, deductibility might well be the outcome of a second-best-optimum-tax approach provided that not all factors of production were mobile. Non-deductibility might be justified by a lack of instruments to internalize environmental and congestion externalities or by perfect mobility of all production factors. However, the existence of deductions in many coun-tries can be easily explained within a public choice framework by redistribution from non-commuters to commuters.
Keywords: Income tax; relief; residential land use; labor mobility; commuting expenses; optimum taxation (search for similar items in EconPapers)
JEL-codes: H21 J61 R13 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-acc, nep-geo, nep-pbe and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8) Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_972
Access Statistics for this paper
More papers in CESifo Working Paper Series from CESifo Group Munich Contact information at EDIRC.
Bibliographic data for series maintained by Klaus Wohlrabe ().