Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/200381 
Year of Publication: 
2019
Series/Report no.: 
ISER Working Paper Series No. 2019-02
Publisher: 
University of Essex, Institute for Social and Economic Research (ISER), Colchester
Abstract: 
This paper analyzes the effect of local income taxation on taxable income, inequality and internal migration in Italy using two tax reforms and several administrative data sources. These reforms, introduced in 2007 and 2011, granted municipalities the authority to switch from a flat to a progressive local income tax. I obtain two main results. First, the progressive tax reduced taxable income by 5 percent and the income share held by the top percentile of the municipal income distribution by 6 percent. Second, I find compelling evidence of a positive effect of net-of-tax rate differentials across provinces on changing fiscal residence.
Subjects: 
Local income tax
Tax progressivity
Taxable income elasticity
Income inequality
Tax-induced migration
JEL: 
D31
H21
H24
H30
H71
Document Type: 
Working Paper

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