Capital income taxation when inherited wealth is not observable

• 成果类型: Article; Proceedings Paper
• 署名作者: Cremer, H; Pestieau, P; Rochet, JC
• 署名单位: Universite de Toulouse; Universite Toulouse 1 Capitole; Universite de Toulouse; Universite Toulouse 1 Capitole; University of Liege; University of Liege
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/S0047-2727(02)00050-6
• 发表日期: 2003
• 页码: 2475-2490
• 关键词: capital income taxation; inherited wealth altruism

摘要

This paper extends the Atkinson-Stiglitz model of direct and indirect taxation to a dynamic setting with two unobservable characteristics: productive ability and inherited wealth. Bequests are motivated by the 'joy of giving'. A child's inheritance is a random variable with a probability distribution that depends on his parent's investment in a 'bequest technology'. Public borrowing is assumed and implies the modified golden rule. We study the optimal tax policy when two instruments are available: a non-linear (wage) income tax and a proportional tax on capital income. We show that the second instrument ought, in general, to be used but that the tax rate is not necessarily positive. However, a positive tax rate is more likely when there is a positive correlation between inherited wealth and innate ability. (C) 2002 Elsevier B.V. All rights reserved.