Abstract

http://ssrn.com/abstract=440021
 
 

References (20)



 
 

Citations (9)



 


 



Tagging and Taxing: The Optimal Use of Categorical and Income Information in Designing Tax/Transfer Schemes


Rivta Immonen


University of Jyvaskyla

Ravi Kanbur


Cornell University - School of Applied Economics and Management; Centre for Economic Policy Research (CEPR); Institute for the Study of Labor (IZA)

Michael Keen


International Monetary Fund (IMF) - Fiscal Affairs Department; CESifo (Center for Economic Studies and Ifo Institute); Institute for Fiscal Studies (IFS)

Matti Tuomala


University of Tampere


Economica, Vol. 65, pp. 179-192, May 1998

Abstract:     
This paper explores aspects of the optimal design of tax/transfer schemes that involve elements of both 'tagging' (the use of categorical benefits) and 'means-testing' (income-relation of benefits). Simulations suggest a striking qualitative dissimilarity between the group-specific schedules optimally imposed on poorer and richer groups: broadly speaking, the optimal marginal tax rate is decreasing in income among the latter but increasing among the former. This latter observation, potentially important for policy, runs counter to the conventional wisdom from previous simulations. The reconciliation, we argue, lies in the role played in optimal tax design by the revenue constraint.

Number of Pages in PDF File: 14

Accepted Paper Series





Date posted: October 13, 2003  

Suggested Citation

Immonen, Rivta and Kanbur, Ravi and Keen, Michael and Tuomala, Matti, Tagging and Taxing: The Optimal Use of Categorical and Income Information in Designing Tax/Transfer Schemes. Economica, Vol. 65, pp. 179-192, May 1998. Available at SSRN: http://ssrn.com/abstract=440021

Contact Information

Rivta Immonen
University of Jyvaskyla
Seminaarinkatu 30
Jyväskylä, 40100
Finland
+ 358 41 601 054 (Phone)
+ 358 41 601 021 (Fax)
Ravi Kanbur (Contact Author)
Cornell University - School of Applied Economics and Management ( email )
248 Warren Hall
Ithaca, NY 14853
United States
607-255-7966 (Phone)
607-255-9984 (Fax)
HOME PAGE: http://www.people.cornell.edu/pages/sk145/
Centre for Economic Policy Research (CEPR)
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
Institute for the Study of Labor (IZA)
P.O. Box 7240
Bonn, D-53072
Germany
Michael Keen
International Monetary Fund (IMF) - Fiscal Affairs Department ( email )
700 19th Street, NW
Washington, DC 20431
United States
CESifo (Center for Economic Studies and Ifo Institute)
Poschinger Str. 5
Munich, DE-81679
Germany
HOME PAGE: http://www.CESifo.de
Institute for Fiscal Studies (IFS)
7 Ridgmount Street
London, WC1E 7AE
United Kingdom
Matti Tuomala
University of Tampere ( email )
P.O. Box 607
Tampere, FIN-33101
Finland
+358-3-2156031 (Phone)
+358-3-2157254 (Fax)
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References:  20
Citations:  9

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