Abstract(s)
We provide an analytical overview of the distortionary eff ects of some common forms of taxes faced by the nonrenewable resources sector of the economy. In the category of taxes meant speci fically to capture the resource rent, we look at a speci c severance
tax, an 'ad valorem' severance tax, a profi t tax and a 'lump-sum' tax, with emphasis
on their e ffects on the extraction decisions over time and on the initial reserves to be
developed. In the category of taxes meant for all sectors of the economy, we look at
the corporate income tax and its special provision for the resource sector in the form
of a depletion allowance, with emphasis on the eff ects on the intra-industry resource
extraction decisions and on the inter-industry allocation of investment.