This paper analyses the effects of the personal income tax (PIT) changes implemented in Italy in the period 1995-2005 on redistribution and efficiency. on the redistributive side, using Lorenz dominance techniques and their correspondence with welfare prescriptions, the paper shows that many changes of PIT do not appear fruitful for the purpose of redistributin income. Furthermore, there is no conclusive evidence that PIT changes since 1995 are targeted on condition of greater needs, as those of households with children, especially because a significant part of tax credits paid for this purpose are non-refundable. Finally, on the efficiency side, PIT changes in the last decade do not avoid the presence of high effective marginal tax rates when PIT and child benefits are jointly considered.
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Volume (Year): 64 (2005) Issue (Month): 2-3 (November) Pages: 159-188 Download reference. The following formats are available: HTML
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Handle: RePEc:gde:journl:gde_v64_n2-3_p159-188
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Find related papers by JEL classification: H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
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