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- Title
Redistribution within the tax-benefits system in Austria.
- Authors
Christl, Michael; Köppl–Turyna, Monika; Lorenz, Hanno; Kucsera, Dénes
- Abstract
The aim of this study is to analyze redistribution within the Austrian tax-benefits system. In this work, we take a comprehensive view and include not only direct taxation and cash benefits but also indirect taxes and in-kind transfers. We look at two kinds of redistribution: between households belonging to different income groups, and between generations, taking a life-cycle perspective. Our analysis shows that indirect taxes (as understood in previous literature) have a regressive effect on the tax-benefits system. In contrast, in-kind benefits seem to have a progressive effect. To analyze the impact of both, we extend our income concept to include both indirect taxes and in-kind benefits. If we look at the distributional impact, we find that the inequality-enhancing effect of indirect taxes is more than offset by the inequality-reducing effect of in-kind benefits. The Gini coefficient increases from 0.24 to 0.26 due to indirect taxes, but when adding in-kind benefits, the Gini coefficient is reduced to 0.23. The overall effect of both indirect taxes and in-kind benefits is progressive. • We analyze effect of direct taxation, cash and in-kind benefits, and indirect taxes. • Indirect taxes have a regressive effect; in-kind benefits have a progressive effect. • Effect of indirect taxes is more than off-set by the effect of in-kind benefits.
- Subjects
AUSTRIA; INDIRECT taxation; DIRECT taxation; GINI coefficient; INHERITANCE &; transfer tax; TAX benefits
- Publication
Economic Analysis & Policy, 2020, Vol 68, p250
- ISSN
0313-5926
- Publication type
Article
- DOI
10.1016/j.eap.2020.09.011