The Fiscal Trilemma in a Danish Perspective

Rasmus Højbjerg Jacobsen, Søren Nielsen and Anders Sørensen
Authors registered in the RePEc Author Service: Anders Sørensen

Public Finance Review, 2013, vol. 41, issue 6, 791-823

Abstract: This article argues that the “fiscal trilemma†—the tension between sufficient revenue and long-run fiscal sustainability on one side; medium- to long-run growth opportunities on the other; and progressivity and avoidance of inequality on the third side—is very much present in Denmark. We provide an overview of main features of the Danish tax system; the state of fiscal balances in the short and longer run; growth and productivity developments; and the extent of inequality in the Danish society. Thereafter, we go into details with reforms and changes in the tax system over the last twenty-five years and diagnose main problem areas. We argue that the tax reform carried in Parliament on September 13, 2012, does not pass a “trilemma test†; that is, it is in conflict with at least one of the three key considerations. Finally, we put forth reform elements that should improve the system.

Keywords: tax policy; Denmark; fiscal sustainability; productivity; income inequality (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://journals.sagepub.com/doi/10.1177/1091142113497082 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:sae:pubfin:v:41:y:2013:i:6:p:791-823

DOI: 10.1177/1091142113497082

Access Statistics for this article

More articles in Public Finance Review
Bibliographic data for series maintained by SAGE Publications ().