Estimation of Optimal Commodity Tax Rates in Iran
This study estimates optimal commodity tax rates regarding efficiency and social justice. A many- person Ramsey rule and Bergson – Samuelson social welfare function are used for estimating optimal tax rates. We need to estimate price elasticities of commodities before computing optimal tax rates. Th...
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| Format: | Article |
| Language: | fas |
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Allameh Tabataba'i University Press
2008-09-01
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| Series: | Faslnāmah-i Pizhūhish/Nāmah-i Iqtisādī |
| Online Access: | https://joer.atu.ac.ir/article_3205_bc3038319614ffe87a577ef29e497120.pdf |
| _version_ | 1797375729171693568 |
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| author | Abbas Arabmazar Ali Akbar Bajelan |
| author_facet | Abbas Arabmazar Ali Akbar Bajelan |
| author_sort | Abbas Arabmazar |
| collection | DOAJ |
| description | This study estimates optimal commodity tax rates regarding efficiency and social justice. A many- person Ramsey rule and Bergson – Samuelson social welfare function are used for estimating optimal tax rates. We need to estimate price elasticities of commodities before computing optimal tax rates. These elasticites come from estimation of Almost Ideal Demand System based on household expenditure data, in urban area,s over the period of 1993-2005 and 10 cost deciles. The Almost Ideal Demand System has been estimated by using Panel Data approach. The contrast between efficiency and equity is examined by including a parameter called ''Rate of inequality aversion parameter'' in social welfare function. Optimal tax rates are computed from Lagrange – approach solution of nonlinear systems under alternative assumptions about rate of inequality aversion parameter and fixed Tax Revenues.
The Results show that when inequality aversion parameter equals zero, optimal tax of different commodities will be equal. Otherwise, they are different. The larger the parameter, the greater the difference. Tax rates on commodities which have large share in expenditure of lower deciles decrease while tax rates on other commodities increase. Also, with increase of the parameter, marginal cost of the social welfare decreases. |
| first_indexed | 2024-03-08T19:28:35Z |
| format | Article |
| id | doaj.art-7fe89b44289148ac8d52f6865c4f8517 |
| institution | Directory Open Access Journal |
| issn | 1735-210X 2476-6453 |
| language | fas |
| last_indexed | 2024-03-08T19:28:35Z |
| publishDate | 2008-09-01 |
| publisher | Allameh Tabataba'i University Press |
| record_format | Article |
| series | Faslnāmah-i Pizhūhish/Nāmah-i Iqtisādī |
| spelling | doaj.art-7fe89b44289148ac8d52f6865c4f85172023-12-26T07:56:36ZfasAllameh Tabataba'i University PressFaslnāmah-i Pizhūhish/Nāmah-i Iqtisādī1735-210X2476-64532008-09-0183041693205Estimation of Optimal Commodity Tax Rates in IranAbbas Arabmazar0Ali Akbar Bajelan1عضو هیأت علمی دانشکده علوم اقتصادی و سیاسی- دانشگاه شهید بهشتیکارشناس ارشد اقتصادThis study estimates optimal commodity tax rates regarding efficiency and social justice. A many- person Ramsey rule and Bergson – Samuelson social welfare function are used for estimating optimal tax rates. We need to estimate price elasticities of commodities before computing optimal tax rates. These elasticites come from estimation of Almost Ideal Demand System based on household expenditure data, in urban area,s over the period of 1993-2005 and 10 cost deciles. The Almost Ideal Demand System has been estimated by using Panel Data approach. The contrast between efficiency and equity is examined by including a parameter called ''Rate of inequality aversion parameter'' in social welfare function. Optimal tax rates are computed from Lagrange – approach solution of nonlinear systems under alternative assumptions about rate of inequality aversion parameter and fixed Tax Revenues. The Results show that when inequality aversion parameter equals zero, optimal tax of different commodities will be equal. Otherwise, they are different. The larger the parameter, the greater the difference. Tax rates on commodities which have large share in expenditure of lower deciles decrease while tax rates on other commodities increase. Also, with increase of the parameter, marginal cost of the social welfare decreases.https://joer.atu.ac.ir/article_3205_bc3038319614ffe87a577ef29e497120.pdf |
| spellingShingle | Abbas Arabmazar Ali Akbar Bajelan Estimation of Optimal Commodity Tax Rates in Iran Faslnāmah-i Pizhūhish/Nāmah-i Iqtisādī |
| title | Estimation of Optimal Commodity Tax Rates in Iran |
| title_full | Estimation of Optimal Commodity Tax Rates in Iran |
| title_fullStr | Estimation of Optimal Commodity Tax Rates in Iran |
| title_full_unstemmed | Estimation of Optimal Commodity Tax Rates in Iran |
| title_short | Estimation of Optimal Commodity Tax Rates in Iran |
| title_sort | estimation of optimal commodity tax rates in iran |
| url | https://joer.atu.ac.ir/article_3205_bc3038319614ffe87a577ef29e497120.pdf |
| work_keys_str_mv | AT abbasarabmazar estimationofoptimalcommoditytaxratesiniran AT aliakbarbajelan estimationofoptimalcommoditytaxratesiniran |