Efficient timing of income taxes

Geoffrey H. Kingston

doi:10.1016/0047-2727(84)90030-6

Efficient timing of income taxes

Geoffrey H. Kingston^*

^*Corresponding author for this work

Research output: Contribution to journal › Article › peer-review

9 Citations (Scopus)

Abstract

The marginal collection cost of an income tax is predicted to be a martingale, and the marginal income tax rate is predicted to be a supermartingale. Collection costs can be estimated from tax rates. Almost all tests based on a U.S. series of actual marginal income tax rates, 1913-1975, accept the hypothesis of random-walk behavior in collection costs, and reject the parallel hypothesis on tax rates.

Original language	English
Pages (from-to)	271-280
Number of pages	10
Journal	Journal of Public Economics
Volume	24
Issue number	2
DOIs	https://doi.org/10.1016/0047-2727(84)90030-6
Publication status	Published - 1984
Externally published	Yes

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10.1016/0047-2727(84)90030-6

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title = "Efficient timing of income taxes",

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AB - The marginal collection cost of an income tax is predicted to be a martingale, and the marginal income tax rate is predicted to be a supermartingale. Collection costs can be estimated from tax rates. Almost all tests based on a U.S. series of actual marginal income tax rates, 1913-1975, accept the hypothesis of random-walk behavior in collection costs, and reject the parallel hypothesis on tax rates.

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DO - 10.1016/0047-2727(84)90030-6

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JO - Journal of Public Economics

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Efficient timing of income taxes

Abstract

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