Income and saving responses to tax incentives for private retirement savings

• 成果类型: Article
• 署名作者: Chan, Marc K.; Morris, Todd; Polidano, Cain; Vu, Ha
• 署名单位: University of Melbourne; Max Planck Society; University of Melbourne; Deakin University
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2021.104598
• 发表日期: 2022
• 关键词: Tax concessions; Retirement saving; taxable income; labor supply

摘要

Many governments offer tax concessions for retirement contributions. In this paper, we show that income responses are crucial for understanding their effectiveness in raising retirement savings and alleviating the fiscal pressures of population aging. Using tax register data, we study large changes in caps on tax-favored contributions to individual retirement accounts in Australia. We find that higher caps increase retirement contributions considerably, with around two-thirds of this response financed by increases in earned income. The resulting gain in income tax revenue offsets the fiscal loss from tax concessions, highlighting the importance of taking income and labor supply responses into account. (c) 2022 Elsevier B.V. All rights reserved.