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Options for a UK 'flat tax': some simple simulations

Stuart Adam and James Browne
Briefing note
This Briefing Note analyses the effects of four possible flat tax systems for the UK: one that flattens the rate structure of income tax only, one that also flattens National Insurance contributions, and two that flatten the combined rate structure of income tax and tax credits (with and without flattening National Insurance contributions as well).

In all cases, the tax base is left unchanged. The analysis is conducted for the working-age population only, and in all cases the reforms are designed to be revenue neutral under the strong assumption that people do not change their behaviour in response to the reforms. We examine the effects of the reforms on particular example families and on the overall distributions of income and work incentives.

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This presentation was given at a seminar at the London School of Economics on 19 November 2018.
This presentation is one of a series on the economics of tax policy.