The distributional effects of personal income tax expenditure

Arbeitspapier

Using EUROMOD, this study investigates the size and distributional effects of tax allowances and tax credits in 6 European countries. It also examines whether instrument design matters in shaping the redistributive effect, paying attention to both categorical and explicit income targeting .With few exceptions the impact of tax allowances and tax credits on inequality is small. Tax credits are generally more progressive than tax allowances. The design of the allowances/credits appears to be less important than the characteristics of the population they are targeting and/or other features of the income tax system in determining the redistributive effect. Consequently, tax concessions appear ill-suited to target resources towards households in the bottom part of the income distribution.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: ISER Working Paper Series ; No. 2014-26

Classification and Topics

• Classification: Wirtschaft ; Personal Income, Wealth, and Their Distributions ; Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes ; Welfare, Well-Being, and Poverty: Government Programs; Provision and Effects of Welfare Programs
• Subject: tax expenditure ; redistribution ; income tax ; microsimulation

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Avram, Silvia
• Event: Veröffentlichung
• (who): University of Essex, Institute for Social and Economic Research (ISER)
• (where): Colchester
• (when): 2014

Further information

• Handle: http://hdl.handle.net/10419/123806
• Last update: 10.03.2025, 11:41 AM CET