Income Taxation Across Countries

Xincheng Qiu and Nicolo Russo ()
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Nicolo Russo: Goethe University Frankfurt

No 18190, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper examines income tax systems in over thirty countries over the past forty years using microdata from the Luxembourg Income Study. We show that income tax systems worldwide are well approximated by a two-parameter log-linear effective tax function. We provide country- and year-specific estimates and document several insights. First, higher average tax rates are associated with higher progressivity. Second, richer countries have more progressive tax systems. Third, progressivity varies by family structure, with marriage and children associated with higher progressivity. Finally, transfers play an important role in redistribution, making the overall tax-and-transfer function more progressive than the tax function.

Keywords: family structure; income tax progressivity; taxation (search for similar items in EconPapers)
JEL-codes: E62 H20 H30 (search for similar items in EconPapers)
Date: 2025-10
New Economics Papers: this item is included in nep-acc, nep-pbe and nep-pub
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Working Paper: Income Taxation Across Countries (2025)
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