Alternative Forms of Mineral Taxation, Market Failure and the Environment

July 1, 1992

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Format: Chicago

Timothy R. Muzondo Alternative Forms of Mineral Taxation, Market Failure and the Environment, (USA: International Monetary Fund, 1992) accessed December 23, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper examines the environmental effects of mineral taxes in a framework that recognizes the importance of rates and cumulative externalities and proposes an appropriate corrective tax. It concludes that mineral resources taxation should combine neutral taxes with a dynamic Pigovian type tax proposed in the paper. Such a tax resembles a specific tax plus an element that depends on the amount of remaining reserves. This resemblance means that, in practice, specific taxes may act as proxies for environmental taxes. The paper also points at complementarities and tradeoffs between economic and environmental concerns that could arise in reforming mineral taxes.

Subject: Environment, Environmental taxes, Natural resources, Non-renewable resources, Resource rent tax, Taxes

Keywords: Cash flow, Corrective tax, Depletion date, Environmental taxes, Lump-sum tax, Natural resources, Non-renewable resources, Output tax, Rate of interest, Rates of extraction, Rent tax, Resource rent tax, Tax package, WP

Publication Details

Pages:

44
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 1992/049
Stock No:

WPIEA0491992
ISBN:

9781451971729
ISSN:

1018-5941

Notes

Also published in Staff Papers, Vol. 40, No. 1, March 1993.

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