OECD Economics Department Working Papers

ISSN: 
1815-1973 (online)
DOI: 
10.1787/18151973
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Working papers from the Economics Department of the OECD that cover the full range of the Department’s work including the economic situation, policy analysis and projections; fiscal policy, public expenditure and taxation; and structural issues including ageing, growth and productivity, migration, environment, human capital, housing, trade and investment, labour markets, regulatory reform, competition, health, and other issues.

The views expressed in these papers are those of the author(s) and do not necessarily reflect those of the OECD or of the governments of its member countries.

 

Taxing the Rent of Non-Renewable Resource Sectors

A Theoretical Note You or your institution have access to this content

English
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Author(s):
Julien Daubanes1, Saraly Andrade de Sá1
Author Affiliations
  • 1: ETH Zurich, Switzerland

21 July 2014
Bibliographic information
No.:
1149
Pages:
32
DOI: 
10.1787/5jz0zb620vr1-en

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This study analyses the economic rent generated by the exploitation of a non-renewable resource, and the taxation of this rent. We present a synthetic model of a non-renewable-resource sector where deposits must be costly developed before they are exploited; the analysis emphasizes the effect of resource taxation on the discouragement to the development of new reserves. We discuss the limitations of neutral profit-taxation schemes and examine the distortions caused by various resource-taxation systems on the rent and its allocation: tax evasion, royalty-induced distortions, imperfect tax commitment, agency issues... We also discuss the measurement of resource rents for taxation purposes, and issues with the management of the resource tax income.
Keywords:
resource rents, tax distortions, non-renewable resources, tax income management
JEL Classification:
  • H20: Public Economics / Taxation, Subsidies, and Revenue / General
  • Q30: Agricultural and Natural Resource Economics ; Environmental and Ecological Economics / Nonrenewable Resources and Conservation / General
 
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