Alternative forest tax regimes and tax capitalization.

摘要

It has long been asserted that taxation distorts the production decisions of timber land owners. More recently, claims have been that this does not occur because the tax is fully shifted into sawlog prices. This paper constructs a model of landowner choice between a property tax programme and a modified yield tax programme under the assumption of tax capitalization. Under tax shifting, the landowner will be indifferent between tax regimes. With tax capitalization owners of younger stands will elect to classify their stands for the modified yield tax programme. An empirical model of binary choice is evaluated using cross sectional forty level data from Cowlitz County, Washington immediately after implementation of the Reforestation Act of 1931. The empirical results suggest that landowners are responsive to differences in the taxing pattern in a manner conforming to the theoretical predictions consistent with tax capitalization. Additional results suggest that implementation of the alternate tax regime may have had little effect on tax defaults. The tax capitalization result is extended to derive expressions for pigouvian taxes designed to influence stand management, consistent with the increasing timber prices encountered in the postwar world.