Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/108260
Authors: 
Simonovits, András
Year of Publication: 
2012
Series/Report no.: 
IEHAS Discussion Papers MT-DP - 2012/18
Abstract: 
We analyze the impact of tax morale on the optimal progressive labor income taxation. Only universal basic income is financed from a linear tax and the financing of public goods is neglected. Each individual supplies labor and (un)declares earning, depending on his labor disutility and tax morale. Limiting the utilitarianism to the poorer parts of the population (defined by the inclusion share), the optimal tax rate is an increasing function of the tax morale and a decreasing function of the inclusion share, provide that the average wage of the included is higher than 0.54 times the average wage.
Subjects: 
tax morale
progressive income tax
undeclared earning
labor supply
income redistribution
JEL: 
H21
H26
H41
D58
ISBN: 
978-615-5243-12-7
Document Type: 
Working Paper

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