Border Tax Adjustments and Tariff-Tax Reforms with Consumption Pollution
Nikos Tsakiris (),
Panos Hatzipanayotou () and
University of Cyprus Working Papers in Economics from University of Cyprus Department of Economics
We develop a model of a small open economy, where pollution per unit of consumption between domestically produced and imported quantities of the same good differs. We show that the first-best policy combination calls for consumption taxes on all polluting goods, and Border Tax Adjustment (BTA) measures, i.e., tariffs or import subsidies. We identify conditions under which well known tariff-tax reform policies for developing economies, such as a consumer-price-neutral piecemeal reform of a trade and a consumption tax, and a consumer-price-neutral reform of all trade and consumption taxes improve welfare. We also evaluate whether a consumer-price-neutral reform of a tariff and a consumption tax is superior to a reform of a tariff alone.
Keywords: Consumption generated Pollution; Optimal Taxation; Border Tax Adjustments; Trade and Consumption Tax Reforms (search for similar items in EconPapers)
JEL-codes: F13 F18 H20 H21 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-int, nep-pbe and nep-pub
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
Working Paper: Border Tax Adjustments and Tariff-Tax Reforms with Consumption Pollution (2018)
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:ucy:cypeua:17-2018
Access Statistics for this paper
More papers in University of Cyprus Working Papers in Economics from University of Cyprus Department of Economics
Bibliographic data for series maintained by ().