Voluntary pension savings and tax incentives: Evidence from Finland

Jarkko Harju

No 33, Working Papers from VATT Institute for Economic Research

Abstract: This paper studies empirically savers' behavioral responses to the Finnish tax reform of 2005 by using comprehensive panel data. The tax schedule of voluntary pension savings changed from progressive to proportional, changing the saving incentives in different subgroups. The results indicate that the reform altered saving behavior by reducing voluntary pension saving coverage among high income-earners by 4 percentage points and increasing it among low incomeearners by 2 percentage points. The reform also reduced annual saving contributions among high income-earners by over 20 percent. The estimated effects result entirely from the changed saving behavior of men.

Keywords: Voluntary pension savings, tax reform, tax incentives, Taxation, Verotus, Taxation and Social Transfers, Julkisen talouden rahoitus ja tulonsiirrot, H240 - Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes, H310 - Fiscal Policies and Behavior of Economic Agents: Household (effects on labor supply), (search for similar items in EconPapers)
Date: 2012
New Economics Papers: this item is included in nep-acc, nep-age and nep-pbe
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Citations: View citations in EconPapers (1)

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https://www.doria.fi/handle/10024/148771

Related works:
Journal Article: Voluntary Pension Savings and Tax Incentives: Evidence from Finland (2013)
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