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Becker, Charles; Fullerton, Don - 2022

We examine six alternative plans which might be discussed in an effort to increase consumer savings through the … personal income tax system in the United States. These plans attempt to affect savings through an increase in the real rate of … return either by direct tax cuts on savings or by indexing tax rates against inflation. The paper presents estimates of …

Persistent link: https://www.econbiz.de/10013322914

A Tax on Output of the Polluting Industry is Not a Tax on Pollution : the Importance of Hitting the Target

Fullerton, Don; Hong, Inkee; Metcalf, Gilbert E. - 2021

We explore the effects of environmental taxes that imprecisely target pollution. A review of actual policies indicates few (if any) examples of a true tax on pollution. More typically, environmental taxes target an input or output that is correlated with pollution. We construct a simple...

Persistent link: https://www.econbiz.de/10013230179

Second-Best Pollution Taxes

Fullerton, Don - 2021

When government needs more revenue than is available from a pollution tax rate equal to marginal environmental damage, our intuition tells us to raise the tax on the clean good above zero and to raise the tax on the dirty good above that first-best Pigouvian rate. Yet new results suggest that...

Persistent link: https://www.econbiz.de/10013218414

A Simulation-Based Welfare Loss Calculation for Labor Taxes with Piecewise-Linear Budgets

Fullerton, Don; Gan, Li - 2021

Graduated income tax rates and transfer programs create piecewise-linear budget constraints that consist of budget segments and kink points. With any change in these tax rules, each individual may switch between a kink point and a budget segment, between two budget segments, or between two kink...

Persistent link: https://www.econbiz.de/10013239984

Replacing the U.S. Income Tax with a Progressive Consumption Tax : A Sequenced General Equilibrium Approach

Fullerton, Don; Shoven, John B.; Whalley, John - 2021

consumption tax. We compute a sequence of single period equilibria in which savings decisions depend on the expected future return …

Persistent link: https://www.econbiz.de/10013311910

Uncertainty, Welfare Cost, and the 'Adaptability' of U.S. Corporate Taxes

Fullerton, Don; Lyon, Andrew B.; Rosen, Richard J. - 2021

Alternative corporate tax systems differ in their ability to adapt to changes in the rate of inflation. Absent complete indexing of depreciation allowances, a tax system may use the expected inflation rate to set accelerated depreciation allowances in a way that minimizes the welfare loss from...

Persistent link: https://www.econbiz.de/10013227004

Six Distributional Effects of Environmental Policy

Fullerton, Don - 2011

While prior literature has identified various effects of environmental policy, this note uses the example of a proposed carbon permit system to illustrate and discuss six different types of distributional effects: (1) higher prices of carbon-intensive products, (2) changes in relative returns to...

Persistent link: https://www.econbiz.de/10013131305

Can a Unilateral Carbon Tax Reduce Emissions Elsewhere?

Elliott, Joshua - 2013

One country that tries to reduce greenhouse gas emissions may fear that other countries get a competitive advantage and increase emissions ("leakage"). Estimates from computable general equilibrium (CGE) models such as Elliott et al (2010a,b) indicate that 15% to 25% of abatement might be offset...

Persistent link: https://www.econbiz.de/10013085118

Leakage, Welfare, and Cost-Effectiveness of Carbon Policy

Baylis, Kathy - 2014

We extend the model of Fullerton, Karney, and Baylis (2012 working paper) to explore cost-effectiveness of unilateral climate policy in the presence of leakage. We ignore the welfare gain from reducing greenhouse gas emissions and focus on the welfare cost of the emissions tax or permit scheme....

Persistent link: https://www.econbiz.de/10013064305

The Marginal Excess Burden of Different Capital Tax Instruments

Fullerton, Don - 2007

Marginal excess burden, defined as the change in deadweight loss for an additional dollar of tax revenue, has been measured for labor taxes, output taxes, and capital taxes generally. This paper points out that there is no we1 1-defined way to raise capital taxes in general, because the taxation...

Persistent link: https://www.econbiz.de/10012777289