What Makes the Personal Income Tax Progressive? A Comparative Analysis for Fifteen OECD Countries

Adam Wagstaff and Eddy Van Doorslaer

International Tax and Public Finance, 2001, vol. 8, issue 3, 299-316

Abstract: In this paper, we explore the roles of tax credits, rate structures, allowances and deductions in determining the overall progressivity of net income tax liabilities in fifteen OECD countries. Three clusters emerge: (i) the rate-structure countries, Australia, France, Italy, the Netherlands and Spain, where the rate effect is the dominant (but not the only) source of progressivity of gross and net tax liabilities; (ii) the allowance countries, the English-speaking countries other than Australia, where allowances are the dominant source of progressivity; and (iii) the mixed structure countries, Belgium, Finland, Germany and Sweden, where roughly half of the progressivity of gross tax liabilities is attributable to the rate structure. Copyright Kluwer Academic Publishers 2001

Keywords: personal income tax; sources of progressivity (search for similar items in EconPapers)
Date: 2001
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Persistent link: https://EconPapers.repec.org/RePEc:kap:itaxpf:v:8:y:2001:i:3:p:299-316

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DOI: 10.1023/A:1011268209860

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