Journal Article
The fiscal and equity impact of social tax expenditures in the EU
Authors
Publication date
Jul 2020
Summary
Tax expenditures (TEs) are preferential tax treatments granted to specific individuals or categories of households, with the aim of achieving social and economic goals. They are widely used by EU Member States. However, their fiscal and equity impacts are not always clear and their effectiveness and efficiency as a policy instrument need to be carefully evaluated, especially in the present context of constrained public finances. This article quantifies the fiscal and equity effects of social TEs related to housing, education and health in 28 European countries making use of EUROMOD, the EU-wide microsimulation model. We find a variety of effects, in terms of sign and magnitude, across Member States, and within these, among types of households. Overall, our findings suggest that the impact of TE on tax revenues and on income inequalities can be sizable. The redistributive impact of removing TEs can go in both directions, either on the progressive or regressive side, depending on the country and the TE considered.
Published in
Journal of European Social Policy
Volume and page numbers
30 , 355 -369
DOI
https://doi.org/10.1177/0958928719891341
ISSN
16
Subjects
Public Policy, Welfare Benefits, Microsimulation, Taxation, and Economic Policy
Links
University of Essex, Albert Sloman Library Periodicals *restricted to University of Essex registered users* - https://lib.essex.ac.uk/iii/encore/record/C__Rb1656027
Related publications
-
The fiscal and equity impact of social tax expenditures in the EU
Salvador Barrios, Flavia Coda Moscarola, Francesco Figari, et al.
#526434