Empirical Evidence on the Effects of Marginal Tax Rates on Income – The German Case

In 1990 the German personal income tax schedule underwent a major change. We interpret this reform as a ‘natural experiment´ and use a panel of individual income tax returns to analyze the response of income to changes in the individual tax rates. Our results suggest an average elasticity of taxable income with respect to the net-of-tax rate of around 0.4. Due to the detailed information the panel provides, we are not only able to distinguish between different levels of income but also between different types of income. We found very low elasticity estimates in the case of regular employment income, but values of up to 1.0 for business income and for high-income households.

The Responses of Taxable Income Induced by Tax Cuts – Empirical Evidence from the German Taxpayer Panel

The elasticity of taxable income has gained increasing attention as a fiscal policy parameter. This paper provides empirical evidence for Germany and adds to the relatively small body of literature for European countries. We use a large new panel data set to analyze the taxable income response to tax rate changes in 2004 which were part of an extensive reform programme in Germany at the beginning of this century. We find an average elasticity of approximately 0.6. Separately estimated income effects however are mostly small or insignificant. The results vary when dividing taxpayers by income type and group.elasticity of taxable income; tax reform; net-of-tax rate

Die Elastizität des zu versteuernden Einkommens : Messung und erste Ergebnisse zur empirischen Evidenz für die Bundesrepublik Deutschland

Die Arbeit ist ein erster deutscher Beitrag zur new tax responsiveness literature. Wir beobachten das Verhalten eines Panels baden-württembergischer Einkommenssteuerpflichtiger vor dem Hintergrund der Steuerreform 1990 und schätzen die Elastizität des zu versteuernden Einkommens in Bezug auf die Residualrate. Beziehen wir die Schätzung auf alle Steuerfälle, erhalten wir einen sehr niedrigen Elastizitätswert. Gruppiert man dagegen die Steuerfälle nach Einkommensart und Höhe des Einkommens, fallen die Schätzungen in vielen Gruppierungen überraschend hoch aus

Empirical Evidence on the Effects of Marginal Tax Rates on Income: The German Case

In 1990 the German personal income tax schedule underwent a major change. We interpret this reform as a ?natural experiment' and use a panel of individual income tax returns to analyze the response of income to changes in the individual tax rates. Our results suggest an average elasticity of taxable income with respect to the net-of-tax rate of around 0.4. Due to the detailed information the panel provides, we are not only able to distinguish between different levels of income but also between different types of income. We found very low elasticity estimates in the case of regular employment income, but values of up to 1.0 for business income and for high-income households

Reformoption Duale Einkommensteuer: Aufkommens- und Verteilungseffekte

In der vorliegenden Studie werden die Aufkommens- und Verteilungswirkungen einer Einführung der Dualen Einkommensteuer mit Hilfe des IAW-Mikrosimulationsmodells abgeschätzt. Dabei werden Verhaltensanpassungen seitens der Steuerpflichtigen berücksichtigt, die sich an den Erkenntnissen der New-Tax-Responsivenes Literatur orientieren. Ohne Berücksichtigung von Verhaltensreaktionen beziffert sich der mit der Reform zu erwartende Steuerausfall bei der Einkommensteuer auf rund 11,6 Mrd. €. Mit Berücksichtigung von Verhaltensanpassungen sinken die Mindereinnahmen auf rund 7,8 Mrd. €. Hinsichtlich der Verteilungswirkungen würde der Übergang zur Dualen Einkommensteuer eine Umverteilung von unten nach oben bewirken

The responses of taxable income induced by tax cuts: Empirical evidence from the German taxpayer panel

The elasticity of taxable income has gained increasing attention as a fiscal policy parameter. This paper provides empirical evidence for Germany and adds to the relatively small body of literature for European countries. We use a large new panel data set to analyze the taxable income response to tax rate changes in 2004 which were part of an extensive reform programme in Germany at the beginning of this century. We find an average elasticity of approximately 0.6. Separately estimated income effects however are mostly small or insignificant. The results vary when dividing taxpayers by income type and group

Assessing Laws and Legal Authorities for Obesity Prevention and Control

This is the first paper in a two part series on the laws and legal authorities for obesity prevention and control, which resulted from the National Summit on Legal Preparedness for Obesity Prevention and Control in 2008. In this paper, the authors apply the “laws and legal authorities” component of the Centers for Disease Control and Prevention (CDC) legal framework on public health legal preparedness to demonstrate the essential role that law can play in the fight against obesity. Their analysis identified numerous laws and policies in the three vital domains of healthy lifestyles, healthy places, and healthy societies. For example, in terms of healthy lifestyles, governments can impact nutrition through: food subsidies, taxation, and bans; food marketing strategies; and nutritional labeling and education. With regard to healthy places, state and local governments can apply zoning laws and policy decisions to change the environment to encourage healthy eating and physical activity. Governments can promote healthy societies through laws and legal authorities that affect the ability to address obesity from a social perspective (such as antidiscrimination law, health care insurance and benefit design, school and day care for children, and surveillance). This paper describes instances of how current laws and legal authorities affect the public health goal of preventing obesity in both positive and negative ways. It also highlights the progressive use of laws at every level of government (i.e., federal, state, and local) and the interaction of these laws as they relate to obesity prevention and control. In addition, general gaps in the use of law for obesity prevention and control are identified for attention and action. (These gaps serve as the basis for the companion paper, which delineates options for policymakers, practitioners, and other key stakeholders in the improvement of laws and legal authorities for obesity prevention and control.