Publication type
ISER Working Paper Series
Series Number
2009-02
Series
ISER Working Paper Series
Author
Publication date
January 28, 2009
Abstract:
The aim of this paper is to describe the state-of-the-art in simulation and to illustrate benefits and problems of linking micro and macro models by analysing flat tax proposals for Germany. The analysis shows that a personal income flat tax can indeed overcome the fundamental equity efficiency trade-off while simultaneously increasing the tax revenue. However, this result does not hold for a flat tax combining a personal income flat tax with a corporate cash flow flat tax, even when allowing for an ex-post loss in revenue as the top of the distribution still gains the most.
Subjects
Notes
working paper
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