Content and objectives
Governments across the globe levy taxes and duties. Tax policy and administration has often been characterized by its rather arcane nature. The role of economic analysis in the setting and administration of taxes has often been rather limited.

More recently, political decision makers have focused their attention on a more efficient and less distortive taxation process. The trend is at least in part due to the general tendency towards a clearer separation of the redistributive goals of the government from its money raising branch. Nowadays, redistributive aims are mostly confined to the public expenditures and the social redistribution programs of the government.  The focus of tax policy is hence undergoing a profound change from a sometimes very complex multi-tasked framework to a streamlined economically efficient revenue producing tool.

Value added tax, as a key tax instrument, is at the forefront of this evolution. By its structure, and by the increasingly international nature of economic transactions, it has undergone the most profound scrutiny. But other tax instruments, such as the personal income tax, or the corporate income tax also have a large potential for improvement, to make them more transparent and less costly to administer while at the same time increasing the revenue they generate.

The objective of the course is to familiarize the student with some key issues in public economics and public finance. Our special attention will be directed to the practical policy implications of these theoretical arguments in terms of a coherent tax policy strategy.

Literature
Joseph Stiglitz (2000), "Economics of the Public Sector" (6th edition), Norton

Recommended Readings

Barbara A. Butrica, Karen E. Smith, and Eric J. Toder, (2008) “How the Income Tax Treatment of Saving and Social Security Benefits May Affect Boomers’ Retirement Incomes”, Urban Institute, Washington DC

Copenhagen Economics, (2007) “Study on reduced VAT applied to goods and services in the Member States of theEuropean Union: Final Report”, EU DG Tax

Textbooks
Ebrill, Keen, Bodin, and Summers (2001), The modern VAT, International Monetary Fund