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The taxman tools up: An event history study of the introduction of the personal income tax

  • Aidt, Toke S.
  • Jensen, Peter S.

The introduction of income taxation was a landmark in the historical development of the fiscal state of the now developed world. This paper presents an event history study of the adoption of the income tax in 17 countries from western Europe, north America, Oceania and Japan between 1815 and 1939. We find evidence that spending pressures, reductions in tax collection costs and to a lesser extent social learning played a significant role for the adoption decision. We also find evidence that the extension of the franchise at first reduced the likelihood of adoption of the income tax, but eventually as universal suffrage was approached increased the likelihood.

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Article provided by Elsevier in its journal Journal of Public Economics.

Volume (Year): 93 (2009)
Issue (Month): 1-2 (February)
Pages: 160-175

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Handle: RePEc:eee:pubeco:v:93:y:2009:i:1-2:p:160-175
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