Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/333629 
Year of Publication: 
2025
Series/Report no.: 
IZA Discussion Papers No. 18190
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
This paper examines income tax systems in over thirty countries over the past forty years using microdata from the Luxembourg Income Study. We show that income tax systems worldwide are well approximated by a two-parameter log-linear effective tax function. We provide country- and year-specific estimates and document several insights. First, higher average tax rates are associated with higher progressivity. Second, richer countries have more progressive tax systems. Third, progressivity varies by family structure, with marriage and children associated with higher progressivity. Finally, transfers play an important role in redistribution, making the overall tax-and-transfer function more progressive than the tax function.
Subjects: 
family structure
FS]income tax
progressivity taxation
JEL: 
E62
H20
H30
Document Type: 
Working Paper

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