Incidencia fiscal de los incentivos tributarios

Fiscal Incidence of tax incentives

Juan Ricardo Ortega, Gabriel Armando Piraquive, Gustavo Adolfo Hernandez, Carolina Soto, Sergio Prada and Juan Ramírez ()

MPRA Paper from University Library of Munich, Germany

Abstract: Tax incentives have traditionally been used as a tool by public policy makers in order to correct or reduce market failures. However, there is a widespread debate, in the international literature, about whether they can or not reaching this goal. In this paper, we propose a methodology to assess different tax incentives proposals using several criteria. We use a computable general equilibrium model for that purpose. Our main result is that in order for tax incentives to meet their goals, there needs to be a clear mechanism in the economy by which resources not received by the government become new private investment. However, it is a complex situation for governments, insofar as ensuring the reinvestment of the forgone resources would require additional governmental intervention, which are difficult to control and involve higher costs in administrative, fiscal and efficiency terms.

Keywords: Colombia; Tax Incentives; Computable General Equilibrium Models (search for similar items in EconPapers)
JEL-codes: D58 H22 (search for similar items in EconPapers)
Date: 2000-11-27
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (17)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:14016

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