How does a fisacl reform affect elasticities of income tax revenues? the case os Spain, 2003-2008
AbstractThis paper estimates the extent to which an exogenous change in income affects income tax revenues. We focus on the case of Spain over the period 2003-2008, as income tax there underwent a substantial reform in 2007. Using both an analytical method and a numerical simulation, we find a significant increase in aggregate income tax elasticities from 1.4 for 2003-2003 to around 1.8 for 2007-2008. The sensitivity of results to the presence of housing tax credits, non-equiproportional variations in income, changes in income inequality and fiscal drag is also considered.
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Bibliographic InfoPaper provided by Universidad Pablo de Olavide, Department of Economics in its series Working Papers with number 10.13.
Length: 25 pages
Date of creation: Nov 2010
Date of revision:
income tax elasticity; progressivity; tax rates; tax credits;
Find related papers by JEL classification:
- H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
This paper has been announced in the following NEP Reports:
- NEP-ACC-2010-11-20 (Accounting & Auditing)
- NEP-ALL-2010-11-20 (All new papers)
- NEP-CMP-2010-11-20 (Computational Economics)
- NEP-PBE-2010-11-20 (Public Economics)
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