Happy Taxpayers? Income Taxation and Well-Being
نویسندگان
چکیده
This paper offers a first empirical investigation of how labor taxation (income and payroll taxes) affects individuals' well-being. For identification, we exploit exogenous variation in tax rules over time and across demographic groups using 26 years of German panel data. We find that the tax effect on subjective well-being is significant and positive when controlling for income net of taxes. This interesting result is robust to numerous specification checks. It is consistent with several possible channels through which taxes affect welfare including public goods, insurance, redistributive taste and tax morale. JEL Classification: H21, H41, I38
منابع مشابه
Income Taxation and Well-Being
Happy Taxpayers? Income Taxation and Well-Being This paper offers a first empirical investigation of how labor taxation (income and payroll taxes) affects individuals' well-being. For identification, we exploit exogenous variation in tax rules over time and across demographic groups using 26 years of German panel data. We find that the tax effect on subjective well-being is significant and posi...
متن کاملEffective taxation of top incomes in Germany , 1992 - 2002
We analyze the taxation of top personal incomes in Germany on the basis of an integrated data file of individual tax returns and a general household survey for the years 1992 2002. The unique feature of this integrated data set is that it includes all taxpayers in the top percentile of the gross income distribution. We show that despite substantial tax base erosion and significant reductions of...
متن کاملEffective Taxation of Top Incomes in Germany , 1992 - 2002 by Stefan Bach
We analyze the taxation of top personal incomes in Germany on the basis of an integrated data file of individual tax returns and a general household survey for the years 1992 – 2002 which includes all taxpayers in the top percentile of the gross income distribution. We show that the distribution of the tax burden is highly concentrated, and that German income taxation has remained effectively p...
متن کاملDemand for “The 1%”: Tax Incidence and Implications for Optimal Income Tax Rates
We develop a model for determining the optimal high income linear tax rate when there exist imperfectly substitutable types of labor. If one type is disproportionately prevalent among higher income taxpayers, then wages adjust in response to more progressive taxation and part of the statutory tax burden is shifted to lower income taxpayers. Our derivation is expressed in terms of readily interp...
متن کاملProposals to Modifv the Taxation of Social Security Benefits: Options and Distributional Effects
This article presents simulation estimates of the income-distributional effects in 1994 of several proposals to modify the taxation of Social Security benefits under the Federal personal income tax. Under the benefit-taxation provisions that have been in effect since 1984, up to 50 percent of benefits are included in taxable income for taxpayers with incomes above certain thresholds. In 1994 ab...
متن کامل