Do Mobile Pensioners Threaten the Deferred Taxation of Savings?

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. We investigate optimal taxation of lifetime income with and without an emigration option during old age. The government sets the rates of deferred taxation and of possibly reduced taxation of interest. If agents are immobile, the optimal policy consists in full deferral of income taxes on savings and a full taxation of interest. Mobility of the old calls for lower degrees of deferral and reduced taxation of interest. However, the optimum never entails full immediate taxation of savings in combination with full tax exemption on capital income. Terms of use: Documents in EconStor mayJEL-Code: H210, H240, H260.

Taxing Pensions of an Internationally Mobile Labor Force: Portability Issues and Taxation Options

“…The scenario of working in a back-loading country (and paying no taxes for retirement income provisions) while retiring in a front-loading country (and paying no taxes on benefits either) would bias mobility decisions as would be the scenario of being taxed on both countries. This has already raised fears mobile retirees threaten back-loaded taxation (Meier and Wagener, 2015).…”