A Taxon Gross Assets of Enterprises as a Form of Presumptive Taxation


Efraim Sadka ; Vito Tanzi

Publication Date:

February 1, 1992

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate


A tax on gross assets has been introduced in some developing countries where several factors (most notably, high inflation) enabled apparently viable enterprises to report losses for income tax purposes. The idea of a tax on the value of assets, rather than on the income that the assets generate, seems to have originated in the 17th century in Milan. It was more recently advocated by Luigi Einaudi and Maurice Allais, but their contributions have remained unknown in the Anglo-Saxon world. The economic implications of such a tax are analyzed in this paper. Special attention is devoted to efficiency and administrative aspects. Practical considerations suggest that the tax on gross assets serves as a minimum income tax rather than as a final tax.


Working Paper No. 1992/016



Publication Date:

February 1, 1992



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