Income tax progressivity, growth, income inequality and welfare

Abstract

This paper analyzes the effects of personal income tax progressivity on long-run economic growth, income inequality and social welfare. The quantitative implications of income tax progressivity increments are illustrated for the US economy under three main headings: individual effects (reduced labor supply and savings, and increased dispersion of tax rates); aggregate effects (lower GDP growth and lower income inequality); and welfare effects (lower dispersion of consumption across individuals and higher leisure levels, but also lower growth of future consumption). The social discount factor proves to be crucial for this third effect: a higher valuation of future generations' well-being requires a lower level of progressivity. Additionally, if tax revenues are used to provide a public good rather than just being discarded, a higher private valuation of such public goods will also call for a lower level of progressivity.

Determinants of Carbon Tax Implementation

“…They states that the implementation of tax policy regulations is related to Taxpayers awareness in use of tax policies as a form of awareness that must be met. This study also supports the research results Jacobs (2013), Echevarría (2015), Alink & Kommer (2016), Prasetyo (2016), Backus & Grant (2019), Adam et.al (2020, Shafika & Fakhroni (2020), Mayoral & Esteban (2019) Wardani & Susilowati (2020), Kate & Milionis (2019), Pratama (2021) and Górecki & Letki (2021) which shows the relationship between tax regulations implementation and busines size. The measure which is a proxy for business activities with regard to the environment as a responsibility for business continuity, is consistent with the results of the research Díaz-Giménez & Pijoan-Mas (2019), Alves &Afonso (2019), andBastani et.al (2020).…”

“…This is a trust (moral) to build trust. Conditions that have great power in participating voluntarily pay taxes (Jacobs, 2013;Echevarría, 2015;Varotsis & Katerelos, 2020;Darmawati & Zelmiyanti, 2021;Shafika & Fakhroni, 2020). An explanation that forms the basis for demonstrating the hypothesis that: JRAK 12.1…”

“…The goal is an effort to create, perserve and maintain the implementation of tax function itself. Another opinion, which agrees, states that determining policy new tax object is result of a process or effort for Taxpayers behavior to realize ideas of legal certainty, social benefits and justice into a reality (Echevarría, 2015;Bastani et.al, 2020). This basis behavior stems from improving service quality and facilitating understanding for Taxpayers in carrying out their tax obligations.…”

“…The implementation of tax regulation policy according to Jacobs (2013), Echevarría (2015), Mayoral & Esteban (2019), Darmawati & Zelmiyanti (2021) and Alpaslan et.al ( 2021) is based on the economic development of Taxpayer in a fair manner. This condition encourages sustainable business development existence of economic activity.…”