MARGINAL TAX RATES AND THE MEASUREMENT OF TAX PROGRESSIVITY

Lea Achdut, Yasser Awad, Jacques Silber

Research output: Chapter in Book/Report/Conference proceedingChapterpeer-review

Abstract

The paper proposes an alternative way of defining tax progressivity, one in which it becomes a function of marginal, not average tax rates. Changes in Tax Progressivity are then related to modifications in the distribution of pre-tax incomes or to variations in marginal rates. Using Israel's Wage and Insurance Data File for the year 1993, the empirical analysis checks the impact of the 1995 Law for the Reduction of Poverty and Income Disparities on the progressivity of the National Insurance Tax System. Simulations are also conducted to study the effect of alternative policies.

Original languageEnglish
Title of host publicationFiscal Policy, Inequality and Welfare
PublisherJAI Press
Pages21-43
Number of pages23
ISBN (Print)0762310243, 9780762310241
DOIs
StatePublished - 2003

Publication series

NameResearch on Economic Inequality
Volume10
ISSN (Print)1049-2585

Bibliographical note

Funding Information:
This research was originally financed by a grant of the Maurice Falk Institute, Jerusalem, Israel. The authors wish to thank Peter Lambert and Shlomo Yitzhaki for their very helpful comments on a previous version of this work.

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