Global Reform of Personal Income Taxation, 1981-2005: Evidence from 189 Countries

Andrew Young School of Policy Studies
National tax journal (Impact Factor: 0.37). 06/2009; DOI: 10.2139/ssrn.1091534
Source: OAI


In this paper we use a panel of 189 countries to describe the salient trends that have emerged in national personal income tax systems spanning the twenty five year period from 1981 to 2005. Using complete national income tax schedules, we calculate actual average and marginal tax rates at different income levels as well as time-varying measures of structural progressivity and complexity of national tax systems. We show that frequent alterations of tax structures have reduced tax rates at higher levels of income and diminished the overall progressivity and complexity of national tax systems; however, the degree of this change varies considerably across countries. We also find that the relationship between the tax rates and revenue is positive for high income countries; however, the strength of the relationship declines with weaker institutions and lower levels of economic development.

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Available from: Steve Buttrick, Oct 18, 2014
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    • "Hence, we need a measure of tax progressivity that is derived from the tax schedule itself. The World Tax Indicators (Peter et al. 2010) is the first comparable and reliable cross-country data set that provides a single measure for the overall progressivity of a tax schedule's progressivity. In the WTI average rate progression (ARP) is calculated as follows: 10 average tax rates for each country and year in the data set are first computed for 100 evenly spread pre-tax incomes. "
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