Tax Progressivity and Income Inequality

This book contains nine research papers by economists on tax progressivity - how the tax burden is borne across income classes.

Joel Slemrod (Author)

9780521465434, Cambridge University Press

Hardback, published 29 July 1994

376 pages, 33 b/w illus. 66 tables
23.7 x 16.1 x 2.6 cm, 0.702 kg

"The papers provide sufficient detail on methodology to be valuable to others wanting to work in the area, and are also accessible to a broader audience. The comments of the discussants add considerable value to the volume by providing alternative perspectives. The inclusion of discussant comments and a summary of frequently insightful comments of attendees bring to mind Brookings volumes on public policy issues. This volume should be of interest to a similar audience." Gerald E. Austen, Journal of Economic Literature

This book assembles nine papers on tax progressivity and its relationship to income inequality, written by leading public finance economists. The papers document the changes during the 1980s in progressivity at the federal, state, and local level in the US. One chapter investigates the extent to which the declining progressivity contributed to the well-documented increase in income inequality over the past two decades, while others investigate the economic impact and cost of progressive tax systems. Special attention is given to the behavioral response to taxation of high-income individuals, portfolio behavior, and the taxation of capital gains. The concluding set of essays addresses the contentious issue of what constitutes a 'fair' tax system, contrasting public attitudes towards alternative tax systems to economists' notions of fairness. Each essay is followed by remarks of a commentator plus a summary of the discussion among contributors.

1. Introduction Joel Slemrod
2. Trends in Federal tax progressivity, 1980–93 Richard Kasten, Frank Sammartino and Eric Toder
Comments William G. Gale
3. The lifetime incidence of state and local taxes: measuring changes during the 1980s Gilbert Metcalf
Comments Robert P. Inman
4. Trends in income inequality: the impact of, and implications for, tax policy Lynn A. Karoly
Comments David M. Cutler
5. The efficiency cost of increased progressivity Robert K. Triest
Comments Gary Burtless
6. On the high-income Laffer curve Joel Slemrod
Comments C. Eugene Steuerle
7. Tax progressivity and household portfolios: descriptive evidence from the surveys of consumer finances John Karl Scholz
Comments Roger H. Gordon
8. Progressivity of capital gains taxation with optimal portfolio selection Michael Haliassos and Andrew B. Lyon
Comments James M. Poterba
9. Perceptions of fairness in the crucible of tax policy Steven M. Sheffrin
Comments Jane G. Gravelle
10. Progressive taxation, equity and tax design Richard A. Musgrave
Index.

Subject Areas: Taxation [KFFD1]