The Willamette River Case: Costs 



227 



of the costs will be borne by the customers of the private electric 

 utility. In the special case of accelerated tax amortization, how- 

 ever, there will be additional costs — costs arising in connection with 

 the provision of financial incentives to equity shareholders in the 

 enterprise, with the general public providing the inducements 

 through taxes. We have already estimated the amount of the 

 shifted tax burden to approximate a quarter of a million dollars 

 annually. Table 44 shows the incidence of the shifted burden, by 

 regions. 



TABLE 44. Regional Incidence of Shifted Tax Liabilities 



Associated with Rapid Amortization, Assuming 

 Tax Model A 



Distribution 

 of the change in 

 tax liabilities 

 Regions (per cent) 



New England 7.05 



Middle Atlantic 24.35 



South Atlantic 9.96 



East South Central ^.42 



East North Central 25.53 



West North Central 7.86 



West South Central 6.40 



Mountain 2.89 



Pacific Coast 12.49 



Total * 99.33 



■ Discrepancy in totals caused by rounding. 



Distribution of 



annual amount of 



changed tax 



liabilities 

 ($ thousand) 



17.6 

 60.7 

 24.8 



8.5 

 63.7 

 19.6 

 16.0 



7.2 

 81.2 



249.3 



REGIONAL INCIDENCE, ASSUMING TAX MODEL B 



Tax Model B, mainly affecting upper-income families and invest- 

 ment, assumed that 50 per cent of the change in taxes would result 

 from a proportionate reduction of personal tax liability and 50 

 per cent would be distributed among enterprises in proportion to 

 their tax liabilities. In this instance also we adopted Musgrave's 

 assumption that 55 per cent of the tax on corporate earnings would 

 fall on profits, 33 per cent would be shifted to consumers, and 12 



