Ulf Gerdtham

Professor

Redistributive effect, progressivity and differential tax treatment : Personal income taxes in twelve OECD countries

Författare

Adam Wagstaff
Eddy Van Doorslaer
Hattem Van Der Burg
Samuel Calonge
Terkel Christiansen
Guido Citoni
Ulf G. Gerdtham
Michael Gerfin
Lorna Gross
Unto Häkinnen
Jürgen John
Paul Johnson
Jan Klavus
Claire Lachaud
Jørgen Lauridsen
Robert E. Leu
Brian Nolan
Encarna Peran
Carol Propper
Frank Puffer
Lise Rochaix
Marisol Rodríguez
Martin Schellhorn
Gun Sundberg
Olaf Winkelhake

Summary, in English

This paper decomposes the redistributive effect of the personal income taxes (PITs) of twelve OECD countries into four components: (i) an average rate effect, (ii) a departure-from-proportionality or progressivity effect, (iii) a horizontal equity effect and (iv) a reranking effect. The product of (i) and (ii) indicates the vertical redistribution associated with the PIT and the sum of (iii) and (iv) indicates the impact on the distribution of income of differential tax treatment. The average tax rate is found to be low in France and high in the Nordic countries, and the PIT is found to be most progressive in France, Ireland and Spain, and least progressive in Denmark and Sweden. Taking (i) and (ii) together, Denmark and the US achieve broadly similar levels of vertical redistributive effect. Differential treatment is found to have a much smaller effect on income redistribution (as a proportion of redistributive effect) than the vertical redistribution caused by progressivity, though there are differences between countries. These differences appear to be due principally to a different emphasis on deductions, such as tax deductibility of mortgage interest payments and insurance premiums, and on local income tax.

Publiceringsår

1999-04-01

Språk

Engelska

Sidor

73-98

Publikation/Tidskrift/Serie

Journal of Public Economics

Volym

Issue

Länkar

Dokumenttyp