Downloads
wp0215.pdf
PDF | 456.9 KB
<p>Responses to changes in marginal income tax rates can be more complex than a simple adjustment in hours worked. Given this, a more inclusive way to assess the deadweight costs of taxes on labour income is to examine the effect of changes in the marginal tax rate on taxable income rather than on labour supply. In this paper we apply a grouping estimator to data from the UK Survey of Personal Incomes so assess the magnitude of taxable income responses of the self employed. Our results point to a modest degree of deadweight loss.</p>
Authors
Laura Blow
Research Fellow University College London
Ian is a Research Fellow of the IFS and a Professor of Economics at UCL. He joined UCL in 1991 and has been attached to the IFS since 1990.
Working Paper details
- DOI
- 10.1920/wp.ifs.2002.0215
- Publisher
- IFS
Suggested citation
Blow, L and Preston, I. (2002). Deadweight loss and taxation of earned income: evidence from tax records of the UK self-employed. London: IFS. Available at: https://ifs.org.uk/publications/deadweight-loss-and-taxation-earned-income-evidence-tax-records-uk-self-employed (accessed: 20 May 2024).
More from IFS
Understand this issue
Public investment: what you need to know
25 April 2024
The £600 billion problem awaiting the next government
25 April 2024
A mess has been made of Child Benefit, and the clear-up operation may not be easy
29 March 2024
Policy analysis
Recent trends in and the outlook for health-related benefits
19 April 2024
4.2 million working-age people now claiming health-related benefits, could rise by 30% by the end of the decade
19 April 2024
Oil and gas make Scotland’s underlying public finances particularly volatile and uncertain
27 March 2024
Academic research
Intertemporal income shifting and the taxation of business owner-managers
24 January 2024
Insurance, redistribution, and the inequality of lifetime income
2 November 2023
The menopause "penalty"
18 March 2024