We analyze Auerbach's (1991) proposal of a retrospective capital gains tax, which is equivalent to an accrual tax on an ex ante basis. Using a continuous-time model with stochastic interest rates and serially correlated asset returns, we prove that such an equivalence still holds. This means that in a more realistic setting the realization-based system requires no ad hoc adjustment for equivalence to hold. © 2010 Mohr Siebeck.
Retrospective capital gains taxation in a dynamic stochastic world
Menoncin F.;Panteghini P. M.
2010-01-01
Abstract
We analyze Auerbach's (1991) proposal of a retrospective capital gains tax, which is equivalent to an accrual tax on an ex ante basis. Using a continuous-time model with stochastic interest rates and serially correlated asset returns, we prove that such an equivalence still holds. This means that in a more realistic setting the realization-based system requires no ad hoc adjustment for equivalence to hold. © 2010 Mohr Siebeck.File in questo prodotto:
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