Advanced Search
MyIDEAS: Login to save this paper or follow this series

Is A Value Added Tax Progressive? Annual Versus Lifetime Incidence Measures

Contents:

Author Info

  • Erik Caspersen
  • Gilbert Metcalf

Abstract

We measure the lifetime incidence of a value added tax (V AT) using income data from the Panel Study of Income Dynamics (PSID) and consumption data from the Consumer Expenditure Survey (CEX). When annual income is used as a measure of economic well-being, a VAT looks quite regressive. However, the results change significantly when the analysis is done using lifetime income. Using two different measures of lifetime income, we find that a VAT in the United States would be proportional to slightly progressive over the lifetime.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.nber.org/papers/w4387.pdf
Download Restriction: no

Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 4387.

as in new window
Length:
Date of creation: Jun 1993
Date of revision:
Publication status: published as National Tax Journal, 47 (1994): pp. 731-746
Handle: RePEc:nbr:nberwo:4387

Note: PE
Contact details of provider:
Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
Phone: 617-868-3900
Email:
Web page: http://www.nber.org
More information through EDIRC

Related research

Keywords:

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Brashares, Edith & Speyrer, Janet Furman & Carlson, George N., 1988. "Distributional Aspects of a Federal Value-Added Tax," National Tax Journal, National Tax Association, vol. 41(2), pages 155-74, June.
  2. James M. Poterba, 1991. "Is the Gasoline Tax Regressive?," NBER Chapters, in: Tax Policy and the Economy, Volume 5, pages 145-164 National Bureau of Economic Research, Inc.
  3. Joshua Angrist & Alan Krueger, 1990. "Does Compulsory School Attendance Affect Schooling and Earnings?," Working Papers, Princeton University, Department of Economics, Industrial Relations Section. 653, Princeton University, Department of Economics, Industrial Relations Section..
  4. Lee A. Lillard, 1975. "Inequality: Earnings vs. Human Wealth," NBER Working Papers 0080, National Bureau of Economic Research, Inc.
  5. Poterba, James M, 1989. "Lifetime Incidence and the Distributional Burden of Excise Taxes," American Economic Review, American Economic Association, American Economic Association, vol. 79(2), pages 325-30, May.
  6. David M. Cutler & Lawrence F. Katz, 1991. "Macroeconomic Performance and the Disadvantaged," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 22(2), pages 1-74.
  7. Lyon, Andrew B & Schwab, Robert M, 1995. "Consumption Taxes in a Life-Cycle Framework: Are Sin Taxes Regressive?," The Review of Economics and Statistics, MIT Press, vol. 77(3), pages 389-406, August.
  8. Parsons, Donald O, 1978. "The Autocorrelation of Earnings, Human Wealth Inequality, and Income Contingent Loans," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 92(4), pages 551-69, November.
  9. Abowd, John M & Card, David, 1989. "On the Covariance Structure of Earnings and Hours Changes," Econometrica, Econometric Society, Econometric Society, vol. 57(2), pages 411-45, March.
  10. Eden, Benjamin & Pakes, Ariel, 1981. "On Measuring the Variance-Age Profile of Lifetime Earnings," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 48(3), pages 385-94, July.
  11. Suits, Daniel B, 1977. "Measurement of Tax Progressivity," American Economic Review, American Economic Association, American Economic Association, vol. 67(4), pages 747-52, September.
  12. Griliches, Zvi, 1977. "Estimating the Returns to Schooling: Some Econometric Problems," Econometrica, Econometric Society, Econometric Society, vol. 45(1), pages 1-22, January.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Mathur, Aparna & Morris, Adele C., 2014. "Distributional effects of a carbon tax in broader U.S. fiscal reform," Energy Policy, Elsevier, Elsevier, vol. 66(C), pages 326-334.
  2. Niklas Bengtsson & Bertil Holmlund & Daniel Waldenström, 2012. "Lifetime versus Annual Tax Progressivity: Sweden, 1968-2009," CESifo Working Paper Series 3856, CESifo Group Munich.
  3. Daniel R. Feenberg & Andrew W. Mitrusi & James M. Poterba, 1997. "Distributional Effects of Adopting a National Retail Sales Tax," NBER Chapters, in: Tax Policy and the Economy, Volume 11, pages 49-90 National Bureau of Economic Research, Inc.
  4. Hammar, Henrik & Jagers, Sverker C., 2007. "What is a fair CO2 tax increase? On fair emission reductions in the transport sector," Ecological Economics, Elsevier, Elsevier, vol. 61(2-3), pages 377-387, March.
  5. Arsić, Milojko & Altiparmakov, Nikola, 2013. "Equity aspects of VAT in emerging European countries: A case study of Serbia," Economic Systems, Elsevier, Elsevier, vol. 37(2), pages 171-186.

Lists

This item is featured on the following reading lists or Wikipedia pages:
  1. Talk:Value added tax/archives 1 in Wikipedia English ne '')

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:4387. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.