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ISBN Number: 9264013202
Publication Date: 02/12/2005
Pages: 128
Number of tables: 48
Number of graphs: 10
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Taxing Working Families: A Distributional Analysis
Apart from revenue raising, taxes are often regarded as effective instruments to achieve a wide variety of public policy goals. For example, policy makers may wish to use the tax system to influence consumer and producer choices, or to modify the distribution of personal incomes and wealth. Even in cases where – in setting tax policy – governments abstain from pursuing explicit distributional goals, tax burdens are seldom distributed in a way in that leaves the shape of the pre-tax distribution of personal incomes unchanged after tax.
Taxing Working Families provides insights into how income taxes and social security contributions affect the distribution of income between different types of families in OECD countries. Certain generally available cash benefits for families – regarded as negative taxes – are also taken into account.
The study concentrates on the effects of these taxes on the distribution of income between different types of working households, looking at three dimensions of inequality: vertical inequality between households at different income levels, horizontal inequality between households with different numbers of children and the tax treatment of one-earner versus two-earner households.
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