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Trends in Personal Income Tax and Employee Social Security Contribution Schedules

Author

Listed:
  • Carolina Torres

    (OECD)

  • Kirsti Mellbye

    (OECD)

  • Bert Brys

    (OECD)

Abstract
Policymakers cannot directly adjust the tax burden of labour income, but they can reform the statutory elements of the tax system, which ultimately determine average and marginal tax rates. To shed light on the determinants of average and marginal personal tax rates, this paper discusses historical and cross-country trends in statutory personal income tax rates, the income thresholds where personal income tax and employee social security contribution rates apply, and other statutory provisions that shape the tax burden on labour income in OECD countries. Trends in the difference between statutory, average and marginal personal income tax rates are also analysed and graphically illustrated. The impact of employee social security contributions on top marginal personal tax rates is also discussed. The most pronounced trend that emerged from 2000 to 2010 in OECD countries is a reduction in top statutory personal income tax rates. This trend was accompanied by reductions in the threshold where the top rate applies, as well as reductions in the statutory rate applicable at average wage earnings. Évolution des barèmes des impôts sur le revenu des personnes physiques et des cotisations de sécurité sociale Les responsables politiques ne sont pas en mesure d’ajuster directement la charge fiscale des revenus du travail mais ils ont la possibilité de réformer les aspects du système fiscal qui sont définis par la loi, et qui déterminent en définitive les taux moyens et marginaux d’imposition. Afin de mettre en lumière les déterminants des taux moyens et marginaux d’imposition des revenus des personnes physiques, ce document étudie, dans une optique rétrospective et internationale, l’évolution des taux légaux de l’impôt sur le revenu des personnes physiques, les seuils d’application de l’impôt sur le revenu et des cotisations salariales de sécurité sociale, ainsi que les autres dispositions légales qui influent sur la charge fiscale des revenus du travail dans les pays de l’OCDE. L’évolution de la différence entre les taux légaux, moyens et marginaux de l’impôt sur le revenu des personnes physiques est également analysée et représentée graphiquement. Par ailleurs, ce document examine l’impact des cotisations salariales de sécurité sociale sur les taux marginaux maximums d’imposition des revenus des personnes physiques. La tendance la plus nette qui se dégage dans les pays de l’OCDE entre 2000 et 2010 est la réduction des taux légaux maximums de l’impôt sur le revenu des personnes physiques. Cette évolution s’est accompagnée de réductions du seuil d’application du taux maximum, ainsi que de réductions du taux légal applicable au salaire moyen.

Suggested Citation

  • Carolina Torres & Kirsti Mellbye & Bert Brys, 2012. "Trends in Personal Income Tax and Employee Social Security Contribution Schedules," OECD Taxation Working Papers 12, OECD Publishing.
    • Handle: RePEc:oec:ctpaaa:12-en
    DOI: 10.1787/5k95qw9633vf-en
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    Citations

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    Cited by:

    1. Mazurek-Chwiejczak Małgorzata, 2016. "The Impact of The Tax System Structure on The Narrowing of Income Disparities in OECD Countries," Financial Internet Quarterly (formerly e-Finanse), Sciendo, vol. 12(3), pages 27-37, October.
    2. Sylwester Bogacki & Agnieszka Sulimierska, 2021. "Personal Income Harmonization Process," European Research Studies Journal, European Research Studies Journal, vol. 0(Special 2), pages 572-586.
    3. Daniela PIRVU & Carmen Mihaela MOGOIU & Claudia STANCIU-TOLEA, 2017. "Taxation Of Personal Incomes In Romania: Present And Perspectives," Scientific Bulletin - Economic Sciences, University of Pitesti, vol. 16(1), pages 45-52.
    4. Toyofuku Miki, 2014. "The end of salaryman tax reduction: Japan’s tax policy and its social background," Contemporary Japan, De Gruyter, vol. 26(1), pages 125-149, March.
    5. Ekrem Toparlak & Hünkar GÜLER, 2018. "The Impact of Underground Economy on the Sustainability of Tax Policy in Turkey," Istanbul Journal of Economics-Istanbul Iktisat Dergisi, Istanbul University, Faculty of Economics, vol. 68(1), pages 161-179, June.
    6. Daniel V. Gordon & Jean-François Wen, 2018. "Tax penalties on fluctuating incomes: estimates from longitudinal data," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 25(2), pages 430-457, April.

    More about this item

    Keywords

    cotisations de sécurité sociale; exonération fiscale; impôt sur le revenu des personnes physiques; personal income tax; social security contributions; statutory tax rate; surtax; surtaxe; taux légal d’imposition; tax exemptions;
    All these keywords.

    JEL classification:

    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue

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