Eastern Journal of European Studies (Dec 2020)
Measurement of personal income tax progressivity in the post-socialist countries of Europe compared to other OECD countries
Abstract
The aim of the article is to measure and analyse changes in the steepness of PIT tax progressivity in OECD countries in 2004-2017, using an alternative method of measuring the type of tax progression. The Steepness Progression Index was developed based on the OECD's indicators of average and marginal taxation in two selected income groups (67% and 167% of average remuneration). The index was used to determine the type of tax progressivity: progressive, regressive and proportional. The result of the empirical study showed that seven OECD groups could be identified among OECD countries with similar levels of progression steepness. Post-socialist countries (except Slovenia) formed one group of countries characterized by the occurrence of regressive progression in the PIT tax and a minimal difference between the average and marginal taxation at both levels of income.
