1887

OECD Economics Department Working Papers

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.

English, French

Taxing the Rent of Non-Renewable Resource Sectors

A Theoretical Note

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.

English

Keywords: non-renewable resources, tax income management, tax distortions, resource rents
JEL: H20: Public Economics / Taxation, Subsidies, and Revenue / Taxation, Subsidies, and Revenue: General; Q30: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Nonrenewable Resources and Conservation / Nonrenewable Resources and Conservation: General
This is a required field
Please enter a valid email address
Approval was a Success
Invalid data
An Error Occurred
Approval was partially successful, following selected items could not be processed due to error