Changes in the tax mix from income taxation to GST: Revenue and redistribution
AbstractThis paper examines the conditions under which a partial shift from a multi-step personal income tax structure towards a general consumption tax can be both revenue-neutral and distribution-neutral, in a cross-sectional context. In the absence of a tax-free-threshold, this can be achieved with a broad-based consumption tax, or one in which, at each income level, the proportion of taxed expenditure is independent of total expenditure. Such a change, involving a smaller percentage reduction in the higher marginal tax rates, is also shown to increase labour supply in a simple continuous-hours model.
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Bibliographic InfoArticle provided by Taylor & Francis Journals in its journal New Zealand Economic Papers.
Volume (Year): 45 (2011)
Issue (Month): 3 (May)
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Web page: http://www.tandfonline.com/RNZP20
Other versions of this item:
- John Creedy & Angela Mellish, 2010. "Changes in the Tax Mix from Income Taxation to GST: Revenue and Redistribution," Department of Economics - Working Papers Series 1102, The University of Melbourne.
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