IDEAS home Printed from https://ideas.repec.org/p/fer/dpaper/273.html
   My bibliography  Save this paper

Labour Tax Reforms and Labour Demand in Finland 1997-2001

Author

Listed:
  • Sinko, Pekka

Abstract

The report describes the development of labour taxation in Finland since the launching of the Employment Guidelines (EG) in 1997. The taxes considered include state and municipal taxes on earned income as well as social security payments of employees and employers. We find that the Finnish tax policies have been broadly in line with the EG goals of ?making the taxation more employment friendly? and targeting tax cuts to the low-paid workers. The size of the tax cuts has nevertheless been relatively modest and are unlikely to have any remarkable effects on labour demand. According to our illustrative calculations, the reduction in income taxes and social security payments could account for some 10 per cent of the overall improvement in employment since 1997. Also, the tax cuts seem to have favoured wage earners with relatively high annual income. At the aggregate level, the average effective tax burden on labour still lies clearly above the EU-average.

Suggested Citation

  • Sinko, Pekka, 2002. "Labour Tax Reforms and Labour Demand in Finland 1997-2001," Discussion Papers 273, VATT Institute for Economic Research.
  • Handle: RePEc:fer:dpaper:273
    as

    Download full text from publisher

    File URL: https://www.doria.fi/handle/10024/148221
    Download Restriction: no

    Citations

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


    Cited by:

    1. Lehmus, Markku, 2014. "Distributional and employment effects of labour tax changes in Finland," Journal of Policy Modeling, Elsevier, vol. 36(1), pages 107-120.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fer:dpaper:273. 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: (Anita Niskanen). General contact details of provider: http://edirc.repec.org/data/vatttfi.html .

    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.

    We have no references for this item. You can help adding them by using 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.