The effect of marginal tax rates on income: a panel study of 'bracket creep'

• 成果类型: Article
• 署名作者: Saez, E
• 署名单位: Harvard University; National Bureau of Economic Research
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/S0047-2727(01)00178-5
• 发表日期: 2003
• 页码: 1231-1258
• 关键词: Income taxation; behavioral responses; bracket creep

摘要

This paper uses a panel of individual tax returns and the 'bracket creep' as source of tax rate variation to construct instrumental variables estimates of the sensitivity of income to changes in tax rates. From 1979 to 1981, the US income tax schedule was fixed in nominal terms while inflation was high (around 10%). This produced a real change in tax rate schedules. Taxpayers near the top-end of a tax bracket were more likely to creep to a higher bracket and thus experience a rise in marginal rates the following year than the other taxpayers. Compensated elasticities can be estimated by comparing the differences in changes in income between taxpayers close to the top-end of a tax bracket to the other taxpayers. These estimates, based on comparisons between very similar groups, are robust to underlying changes in the income distribution, such as a rise in inequality. The elasticities of taxable income and adjusted gross income are around 0.4 and significant but the elasticities of wage income are in general insignificant and close to zero. (C) 2002 Elsevier Science B.V. All rights reserved.