@techreport{Jacob2008rich,
abstract = {The contribution Bach, Corneo, and Steiner (2008) has argued that the rich do not pay taxes adequately in relation to their income, finding, for instance, an effective tax rate of only 38.1% for the 0.001% fractile of German income taxpayers in 2001. This result contrasts sharply with the legislated top marginal income tax rate of 48.5%. We subject the results contained in Bach, Corneo, and Steiner (2008) to a rigorous analysis: We find major flaws and inconsistencies with regard to methodology, i.e. the omission of corporate taxes and inter-temporal aspects of taxation. Restating basic rules for the measurement of effective tax rates, we provide values for what we term the comprehensive nominal tax rate (CNTR) and show that the headline result in Bach, Corneo, and Steiner (2008) of 38.1% is underestimated by over 12 percentage points. As an important distributional result, the CNTR increases with increasing taxable income.},
address = {M\"{u}nchen},
author = {Martin Jacob and Rainer Niemann and Martin Weiss},
copyright = {http://www.econstor.eu/dspace/Nutzungsbedingungen},
keywords = {D31; H00; H24; H25; 330; Top incomes; income taxation; taxing the rich; comprehensive nominal tax rate; Einkommensteuer; Steuerbelastung; Reichtum; Steuerprogression; Deutschland},
language = {eng},
number = {2478},
publisher = {CESifo},
title = {The rich demystified: a reply to Bach, Corneo, and Steiner (2008)},
type = {CESifo working paper},
url = {http://hdl.handle.net/10419/26523},
year = {2008}
}

