The Tax Gradient: Spatial Aspects of Fiscal Competition

• 成果类型: Article
• 署名作者: Agrawal, David R.
• 署名单位: University System of Georgia; University of Georgia
• 刊物名称: AMERICAN ECONOMIC JOURNAL-ECONOMIC POLICY
• ISSN/ISSBN: 1945-7731
• DOI: 10.1257/pol.20120360
• 发表日期: 2015
• 页码: 1-29
• 关键词: taxation; border; MODEL; COORDINATION; responses; Notches

摘要

State borders create a discontinuous tax treatment of retail sales. In a Nash game, local tax rates will be higher on the low state tax side of a border. Local taxes will decrease from the nearest high-tax border and increase from the low-tax border. Using driving time from state borders and all local sales tax rates, local tax rates on the low-tax side of the border are 1.25 percentage points higher, reducing the differential in state tax rates by over three-quarters. A ten minute increase in driving time from the nearest high-tax state lowers a border town's local tax rate by 6 percent.