IDEAS home Printed from https://ideas.repec.org/a/sae/pubfin/v20y1992i1p24-46.html
   My bibliography  Save this article

The Treatment of Transfers in the Measurement of Sales Tax Incidence: the Case of Canada's Manufacturers' Sales Tax

Author

Listed:
  • Giuseppe C. Ruggeri

    (Alberta Treasury and University of Alberta)

  • Kellya. Bluck

    (Alberta Treasury)

Abstract

The purpose of this article is twofold: to determine the appropriate treatment of the Abstract indexation of transfer payments in sales tax incidence and to apply the methodolog ical results to measure the incidence of Canada's Manufacturers'Sales Tax (MST). The article argues that, when measuring sales tax incidence in the presence of transfers, appropriate adjustments must be made only for the actual degree to which transfers are indexed. The article suggests that the effects of full or partial indexing are measured correctly by treating indexing as a negative tax. This adjustment is made automatically by using a distributional measure of incidence based on a comparison of pretax and posttax income. The empirical results indicate that when indexing of transfers is ignored, the MST is mildly regressive. When partial indexing is included and treated as a negative tax, the MST is progressive at the lower end of the income scale, but remains regressive at the top end.

Suggested Citation

  • Giuseppe C. Ruggeri & Kellya. Bluck, 1992. "The Treatment of Transfers in the Measurement of Sales Tax Incidence: the Case of Canada's Manufacturers' Sales Tax," Public Finance Review, , vol. 20(1), pages 24-46, January.
    • Handle: RePEc:sae:pubfin:v:20:y:1992:i:1:p:24-46
    DOI: 10.1177/109114219202000102
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/109114219202000102
    Download Restriction: no
    File URL: https://libkey.io/10.1177/109114219202000102?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Chun-Yan Kuo & Thomas Mcgirr & Satya Poddar, 1988. "Measuring the Non-Neutralities of Sales and Excise Taxes in Canada," Development Discussion Papers 1988-08, JDI Executive Programs.
    2. Earl R. Rolph, 1952. "A Proposed Revision of Excise-tax Theory," Journal of Political Economy, University of Chicago Press, vol. 60(2), pages 102-102.
    3. Harry Gunnison Brown, 1939. "The Incidence of a General Output or a General Sales Tax," Journal of Political Economy, University of Chicago Press, vol. 47(3), pages 418-418.
    4. Harry Gunnison Brown, 1939. "The Incidence of a General Output or a General Sales Tax," Journal of Political Economy, University of Chicago Press, vol. 47(2), pages 254-254.
    5. Browning, Edgar K, 1978. "The Burden of Taxation," Journal of Political Economy, University of Chicago Press, vol. 86(4), pages 649-671, August.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. James Alm & Edward Sennoga & Mark Skidmore, 2005. "Perfect Competition, Spatial Competition, and Tax Incidence in the Retail Gasoline Market," Working Papers 05-09, UW-Whitewater, Department of Economics.
    2. James Alm & Edward Sennoga & Mark Skidmore, 2009. "Perfect Competition, Urbanization, And Tax Incidence In The Retail Gasoline Market," Economic Inquiry, Western Economic Association International, vol. 47(1), pages 118-134, January.
    3. Foeller, William Harry, 1972. "A method for evaluating the impact and incidence of state and local taxes with applications to incidence and educational grant-in-aid programs in Iowa," ISU General Staff Papers 197201010800006909, Iowa State University, Department of Economics.
    4. G. C. Ruggeri & K. Bluck, 1990. "On the Incidence of the Manufacturers' Sales Tax and the Goods and Services Tax," Canadian Public Policy, University of Toronto Press, vol. 16(4), pages 359-373, December.
    5. Poterba, James M., 1996. "Retail Price Reactions to Changes in State and Local Sales Taxes," National Tax Journal, National Tax Association;National Tax Journal, vol. 49(2), pages 165-176, June.
    6. Doyle Jr., Joseph J. & Samphantharak, Krislert, 2008. "$2.00 Gas! Studying the effects of a gas tax moratorium," Journal of Public Economics, Elsevier, vol. 92(3-4), pages 869-884, April.
    7. James B. Davies, 1992. "Tax Incidence: Annual and Lifetime Perspectives in the United States and Canada," NBER Chapters, in: Canada-U.S. Tax Comparisons, pages 151-188, National Bureau of Economic Research, Inc.
    8. Alberto Porto & Marcelo Garriga & Walter Rosales, 2017. "El Impuesto a los Ingresos Brutos y Alternativas de Reforma," IIE, Working Papers 112, IIE, Universidad Nacional de La Plata.
    9. Giuseppe C.Ruggeri, 2009. "Regional Fiscal Flows: Measurement Tools," Working Papers 2009/4, Institut d'Economia de Barcelona (IEB).
    10. Shah, Anwar & Whalley, John, 1990. "An alternative view of tax incidence analysis for developing countries," Policy Research Working Paper Series 462, The World Bank.
    11. Satya Poddar & Ehtisham Ahmad, 2015. "GST Reforms and Intergovernmental Considerations in India," Working Papers id:6824, eSocialSciences.
    12. James M. Dean, 1980. "Benefit Incidence Methodology for Mixed Goods," Public Finance Review, , vol. 8(1), pages 69-96, January.
    13. Alan S. Blinder & Irving Kristol & Wilbur J. Cohen, 1980. "The Level and Distribution of Economic Well-Being," NBER Chapters, in: The American Economy in Transition, pages 415-500, National Bureau of Economic Research, Inc.
    14. Whalley, John, 1999. "Environmental considerations in tax policy design," Environment and Development Economics, Cambridge University Press, vol. 4(1), pages 111-124, February.
    15. Sheng Cheng Hu, 1983. "Value-Added Tax as a Source of Social Security Financing," Public Finance Review, , vol. 11(2), pages 154-180, April.
    16. Richard M. Bird, 2012. "The GST/HST: Creating an Integrated Sales Tax in a Federal Country," SPP Research Papers, The School of Public Policy, University of Calgary, vol. 5(12), March.
    17. Iffat Ara & Qazi Masood Ahmed, 2022. "Differential Impact of Taxation on Food Items," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 27(1), pages 1-19, Jan-June.
    18. Bird, Richard M. & Mintz, Jack M. & Wilson, Thomas A., 2006. "Coordinating Federal and Provincial Sales Taxes: Lessons From the Canadian Experience," National Tax Journal, National Tax Association;National Tax Journal, vol. 59(4), pages 889-903, December.
    19. Jenkins, Glenn P. & Kuo, Chun-Yan, 2000. "A VAT Revenue Simulation Model for Tax Reform in Developing Countries," World Development, Elsevier, vol. 28(4), pages 763-774, April.
    20. Ioana-Laura Tibulca, 2014. "Fiscal Convergence in the European Union in the Context of the Global Financial Crisis," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 4(2), pages 152-158, April.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:pubfin:v:20:y:1992:i:1:p:24-46. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.