Optimal Tax/Expenditure Competition Strategy of Governments in the Presence of Time Inconsistency : The Case for Investment Tax Abacemencs.
Businesses which seek the location that offers the highest profitability are likely to consider tax incentives and the level of government services available. However, once a business commits itself to a locality, high moving costs render it vulnerable to future tax increases or denial of government...
|a Optimal Tax/Expenditure Competition Strategy of Governments in the Presence of Time Inconsistency :
|b The Case for Investment Tax Abacemencs.
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|a Washington, D.C. :
|b International Monetary Fund,
|c 1990.
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|a 1 online resource (20 pages)
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|a IMF Working Papers
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|a <strong>Off-Campus Access:</strong> No User ID or Password Required
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|a <strong>On-Campus Access:</strong> No User ID or Password Required
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|a Electronic access restricted to authorized BRAC University faculty, staff and students
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|a Businesses which seek the location that offers the highest profitability are likely to consider tax incentives and the level of government services available. However, once a business commits itself to a locality, high moving costs render it vulnerable to future tax increases or denial of government services. Fear of time inconsistency will lower expected business profitability in a region. This paper indicates that a developing country or locality can attract a higher level of capital with a tax abatement scheme which provides a subsidy (funded by a capital income tax) equivalent to moving/setup costs.
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|a Mode of access: Internet
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|a IMF Working Papers; Working Paper ;
|v No. 1990/059
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|z Full text available on IMF
|u http://elibrary.imf.org/view/journals/001/1990/059/001.1990.issue-059-en.xml
|z IMF e-Library