Taxation and Mobility: Evidence from Tax Decentralization in Italy

Enrico Rubolino and Tommaso Giommoni

No 10655, CESifo Working Paper Series from CESifo

Abstract: We study the impact of taxation on the location choices of individuals and tax bases in Italy. We exploit some recent tax decentralization reforms, which granted regions and municipalities greater power in setting income tax rates across brackets. Combining granular micro-level data on tax residence transfers with tax rate variations both within and across locations, we show that taxation significantly shapes location decisions. The mobility response greatly varies across the income distribution, with higher responsiveness among top incomes. Yet, our estimates imply that revenue losses due to tax-induced mobility are small, making local redistribution feasible at least over the medium-run.

Keywords: local income taxation; migration; tax decentralization (search for similar items in EconPapers)
JEL-codes: H24 H71 J61 (search for similar items in EconPapers)
Date: 2023
New Economics Papers: this item is included in nep-eur, nep-lab, nep-mig, nep-pbe, nep-pub and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_10655

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