 Presumptive Taxation: Revenue and Automatic Stabilizer AspectsS. Erbas No 1993/069, IMF Working Papers from International Monetary Fund Abstract: Presumptive taxation has been adopted in many countries to tax hard-to-tax activities and reduce evasion. Further, in view of the possible efficiency gains from such techniques, a case can be made for adopting presumptive taxation of global income. This paper addresses two questions. First, could revenue be increased by adopting presumptive tax methods? Second, would presumptive income taxation contribute to macroeconomic instability because it lacks the automatic stabilizer property of standard progressive income taxation? Two simple models suggest that there is scope for increasing revenue under presumptive taxation without necessarily undermining economic stability. The relevance of the first model for presumptive excise taxation in Pakistan is also examined. Keywords: WP; tax liability; presumptive taxation; income level; net revenue collection; distortionary taxation; risk-averse taxpayer; utility function; aggregate tax liability; revenue gain; Presumptive tax; Personal income; Income tax systems; Income and capital gains taxes; Global (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:1993/069 Ordering information: This working paper can be ordered from Access Statistics for this paper More papers in IMF Working Papers from International Monetary Fund International Monetary Fund, Washington, DC USA. Contact information at EDIRC. |
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