Abstract

http://ssrn.com/abstract=2352000
 
 

References (64)



 


 



LOST in America: Evidence on Local Sales Taxes from National Panel Data


David R. Agrawal


University of Kentucky - James W. Martin School of Public Policy and Administration; University of Kentucky - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute)

September 1, 2014


Abstract:     
This paper studies comprehensive national panel data of local option sales taxes at the monthly frequency. I calculate state-by-month population weighted averages and standard deviations of local sales tax rates. I document ten stylized facts concerning the time series patterns and spatial dynamics of local sales tax rates. The paper then proposes a “tax system” approach to tax competition where states compete on a variety of margins -- including restrictions on localities' tax setting authority -- that are often ignored by the standard focus on tax rates. Using spatial panel data techniques and the state-by-month population weighted averages, I find a significant association between one state's tax system and its neighboring states' tax systems.

Number of Pages in PDF File: 57

Keywords: Commodity Taxation, Local Public Finance, Fiscal Federalism, Spatial Tax Competition

JEL Classification: H20, H71, H77, R50, L81


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Date posted: November 10, 2013 ; Last revised: October 8, 2014

Suggested Citation

Agrawal, David R., LOST in America: Evidence on Local Sales Taxes from National Panel Data (September 1, 2014). Available at SSRN: http://ssrn.com/abstract=2352000 or http://dx.doi.org/10.2139/ssrn.2352000

Contact Information

David Robert Agrawal (Contact Author)
University of Kentucky - James W. Martin School of Public Policy and Administration ( email )
433 Patterson Office Tower
Lexington, KY 40506-0027
United States
859-257-8608 (Phone)
University of Kentucky - Department of Economics ( email )
Lexington, KY 40506
United States
CESifo (Center for Economic Studies and Ifo Institute) ( email )
Poschinger Str. 5
Munich, DE-81679
Germany

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