GINI DP 28: The impact of indirect taxes and imputed rent on inequality: A comparison with cash transfers and direct taxes in five EU countries

Francesco Figari () and Alari Paulus

GINI Discussion Papers from AIAS, Amsterdam Institute for Advanced Labour Studies

Abstract: This paper examines the redistributive impact of imputed rent (private and public) and indirect taxes (value added tax and excises), comparing this with the effects of cash transfers and direct taxes in five EU countries. The extended income concept, taking into account both imputed rent and indirect taxes, provides a more reliable picture of inequality differences across countries. Our results show that indirect taxes have a regressive effect with respect to income in all countries considered but always smaller in magnitude than other tax-benefit instruments. Imputed rent reduces overall inequality in particular where the prevalence of individuals living in own accommodation is high even among the poorest (Greece) and where the contribution of the public imputed rent is large (the UK).

Keywords: Imputed rent; indirect taxes; European Union; household income; microsimulation; EUROMOD. JEL: C81; H23; D63 (search for similar items in EconPapers)
Date: 2012-01
New Economics Papers: this item is included in nep-acc, nep-eur and nep-pbe
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Citations: View citations in EconPapers (2)

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Related works:
Journal Article: The Distributional Effects of Taxes and Transfers Under Alternative Income Concepts (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:aia:ginidp:28

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