With the Pareto principle as the sole normative criterion, simple necessary conditions for efficient tax rates on labour and capital incomes are established in an overlapping-generations model. The individuals in the economy have differing earning abilities and their labour supply is elastic. The analysis focuses on inragenerational aspects and is restricted to linear taxation in steady states of a closed economy. Both "global" results on the range of efficient tax rates, and "local" counterparts are given, the latter in the form of upper bounds that depend on the (uncompensated) elasticities of aggregate labour supply and private savings. The Golden Rule is shown to apply in this context.