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Property tax and fiscal discipline in OECD countries

Author

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  • Presbitero, Andrea F.
  • Sacchi, Agnese
  • Zazzaro, Alberto

Abstract

This paper investigates the effects of property taxation on fiscal discipline for a sample of OECD countries over the period 1973–2011. We find that aggregate property taxation in total tax revenues is not statistically correlated with the primary surplus-to-GDP ratio. In contrast, a greater reliance on property taxes pertaining to sub-national governments contributes to fiscal discipline, suggesting that fiscal decentralization should favor responsive tax base instruments.

Suggested Citation

  • Presbitero, Andrea F. & Sacchi, Agnese & Zazzaro, Alberto, 2014. "Property tax and fiscal discipline in OECD countries," Economics Letters, Elsevier, vol. 124(3), pages 428-433.
  • Handle: RePEc:eee:ecolet:v:124:y:2014:i:3:p:428-433
    DOI: 10.1016/j.econlet.2014.06.027
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    Citations

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    Cited by:

    1. Agnese Sacchi & Simone Salotti, 2017. "The influence of decentralized taxes and intergovernmental grants on local spending volatility," Regional Studies, Taylor & Francis Journals, vol. 51(4), pages 507-522, April.
    2. repec:bla:jecsur:v:31:y:2017:i:4:p:1095-1129 is not listed on IDEAS
    3. Santiago Lago-Peñasa & Jorge Martinez-Vazquez & Agnese Sacchic, 2018. "Fiscal stability during the Great Recession: Putting decentralization design to the test," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1805, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    4. Jorge Martinez-Vazquez & Santiago Lago-Peñas & Agnese Sacchi, 2017. "The Impact Of Fiscal Decentralization: A Survey," Journal of Economic Surveys, Wiley Blackwell, vol. 31(4), pages 1095-1129, September.
    5. repec:spr:qualqt:v:53:y:2019:i:1:d:10.1007_s11135-018-0761-2 is not listed on IDEAS
    6. Tommaso Oliviero & Agnese Sacchi & Annalisa Scognamiglio & Alberto Zazzaro, 2016. "House Prices and Immovable Property Taxes: Evidence from OECD Countries," CSEF Working Papers 444, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy, revised 06 Oct 2016.
    7. Santiago Lago-Peñas & Agnese Sacchi & Pablo Simon-Cosano, 2014. "Who honor the rules of federalism? Party system nationalization and fiscal performance," Working Papers. Collection A: Public economics, governance and decentralization 1409, Universidade de Vigo, GEN - Governance and Economics research Network.

    More about this item

    Keywords

    Property tax; Tax decentralization; Sub-national governments; Fiscal imbalance;

    JEL classification:

    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus
    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy

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