A Superior Hybrid Cash-Flow Taxon Corporations
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Summary:
This paper proposes a new hybrid cash-flow tax on corporations that, on one hand, taxes only excess corporate profits as they accrue, and, on the other hand, treats real and financial transactions neutrally. It is, therefore, a superior tax compared to the cash-flow tax on real transactions that seems to have gained common acceptance. The hybrid tax is a modified version of the cash-flow tax on real and financial transactions combined. The modification involves replacing expensing of fixed assets with normal depreciation allowances, but the undepreciated value of fixed assets is carried forward with interest at the opportunity cost of equity capital.
Series:
Working Paper No. 2006/117
Subject:
Anti-money laundering and combating the financing of terrorism (AML/CFT) Corporate income tax Crime Currencies Depreciation Money National accounts Tax allowances Taxes
English
Publication Date:
May 1, 2006
ISBN/ISSN:
9781451863772/1018-5941
Stock No:
WPIEA2006117
Pages:
25
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