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Distribution of personal income tax changes in Slovenia

Author

Listed:
  • Cok, Mitja
  • Sambt, Joze
  • Kosak, Marko
  • Verbic, Miroslav
  • Majcen, Boris

Abstract

Slovenia belongs to a group of EU member states that have reduced their personal income tax burden during the current financial and economic crisis. The latest changes, introduced in the personal income tax system during the last two years, have primarily reduced the tax burden on low-income taxpayers. However, this was only the last step in a series of personal income tax reforms since 2004 that have on average reduced the tax burden on all taxpayers. Using an exclusive database of taxpayers and utilising a general-equilibrium modelling platform, we assess the consequences of these reforms at both the micro and the macro level. From a macroeconomic point of view, the initial positive consequences of higher private consumption and welfare are declining over time due the increased budget deficit and reduced investment.

Suggested Citation

  • Cok, Mitja & Sambt, Joze & Kosak, Marko & Verbic, Miroslav & Majcen, Boris, 2011. "Distribution of personal income tax changes in Slovenia," MPRA Paper 32704, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:32704
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    References listed on IDEAS

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    More about this item

    Keywords

    general equilibrium model; income inequality; macroeconomic effects; microsimulation; personal income tax; Slovenia; tax reform;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies

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