Must losing taxes on saving be harmful?

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dc.contributor.author	Huizinga, Harry	en_US
dc.contributor.author	Nielsen, Søren Bo	en_US
dc.date.accessioned	2009-02-04T10:27:40Z
dc.date.available	2009-02-04T10:27:40Z
dc.date.issued	2004-12-27T00:00:00Z	en_US
dc.identifier.uri	http://hdl.handle.net/10398/7535
dc.description.abstract	Internationalization offers enhanced opportunities for individuals to place savings abroad and evade domestic saving taxation. This paper asks whether the concomi- tant loss of saving taxation necessarily is harmful. To this end we construct a model of many symmetric countries in which public goods are financed by taxes on saving and investment. There is international cross-ownership of firms, and countries are assumed to be unable to tax away pure profits. Countries then face an incentive to impose a rather high investment tax also borne by foreigners. In this setting, the loss of the saving tax instrument on account of international tax evasion may prevent the overall saving-investment tax wedge from becoming too high, and hence may be beneficial for moderate preferences for public goods. A world with 'high- spending' governments, in contrast, is made worse off by the loss of saving taxes, and hence stands to gain from international cooperation to restore saving taxation. JEL-Classifcation: H87, H21 Keywords: Capital income taxation, cross-ownership, coordination	en_US
dc.format.extent	29 s.	en_US
dc.language	eng	en_US
dc.relation.ispartofseries	Working paper;2004-015	en_US
dc.subject.other	kep	en_US
dc.title	Must losing taxes on saving be harmful?	en_US
dc.type	wp	en_US
dc.accessionstatus	modt04dec27 miel	en_US
dc.contributor.corporation	Copenhagen Business School. CBS	en_US
dc.contributor.department	Økonomisk Institut	en_US
dc.contributor.departmentshort	ECON	en_US
dc.contributor.departmentuk	Department of Economics	en_US
dc.contributor.departmentukshort	ECON	en_US
dc.idnumber	x656455011	en_US
dc.publisher.city	København	en_US
dc.publisher.year	2004	en_US