The study looked at how a small open economy should tax factors and goods for optimal economic outcomes. They found that in a scenario where the country can freely choose its tax rates, it's best to tax specific factors and domestic consumption, while not taxing certain types of production and capital income. However, when international rules require a mix of origin and destination-based taxes on goods, a positive tax rate on goods can be beneficial if offset by a subsidy on capital. These findings show how international and domestic constraints can affect the best tax policies for a small open economy.