1. Taxes and benefits
Download icon

Tax-benefit systems, income distribution and work incentives in the European Union

  1. H. Xavier Jara  Is a corresponding author
  2. Alberto Tumino  Is a corresponding author
  1. University of Essex and University of Leuven, United Kingdom
  2. University of Essex, United Kingdom
Research article
Cite this article as: H. Xavier Jara, A. Tumino; 2013; Tax-benefit systems, income distribution and work incentives in the European Union; International Journal of Microsimulation; 6(1); 27-62. doi: 10.34196/ijm.00076
15 figures and 2 tables

Figures

Tax-benefit components as share of household disposable income: all households (2007 policies).

Note: Countries ranked by the size of their tax-benefit system.

Source: EUROMOD version F6.20.

Tax-benefit components as share of household disposable income: bottom decile (2007 policies).

Note: Countries ranked by the size of their tax-benefit system.

Source: EUROMOD version F6.20.

Tax-benefit components as share of household disposable income: top decile (2007 policies).

Note: Countries ranked by the size of their tax-benefit system.

Source: EUROMOD version F6.20.

Income inequality before and after taxes and benefits as measured by the Gini coefficient.

Source: EUROMOD version F6.20

Redistributive effect of tax-benefit instruments, absolute change in the Gini coefficient.

Source: EUROMOD version F6.20

Changes in income inequality 2007–2010.

Note: Countries ranked by Gini coefficient in 2007.

Source: EUROMOD version F6.20.

Marginal effective tax rates across the EU, 2007 (%).

Note: Countries are ranked by the median METR.

Source: EUROMOD version F6.20.

Mean marginal effective tax rates decomposition by income source across the EU, 2007 (%).

Note: Countries are ranked by the mean METR.

Source: EUROMOD version F6.20.

Mean marginal effective tax rates decomposition across the EU, Lowest two deciles of the income distribution, 2007(%).

Note: Countries are ranked by the mean METR.

Source: EUROMOD version F6.20.

Proportion of high METR by deciles of equivalised disposable income, 2007.

Note: Proportion of METRs above 50% across deciles of income distribution.

Source: EUROMOD version F6.20.

Proportion of high METR by deciles of equivalised disposable income, 2007.

Source: EUROMOD version F6.20.

Proportion of high METR by deciles of equivalised disposable income, 2007.

Source: EUROMOD version F6.20.

Average METRs in 2007 and 2010 (%).

Note: Countries are ranked by average METR in 2007.

Source: EUROMOD version F6.20.

Relationship between income inequality and work incentives (2007).

Source: EUROMOD version F6.20.

Relationship between changes in GINI and changes in mean METR.

Note: Differences in GINI and METRs expressed in percentage points.

Source: EUROMOD version F6.20.

Tables

Table A1
METRs Distribution across the EU, 2007.
MEAN MEDIAN PERCENTILES
25% 75%
AUSTRIA 39.3 44.6 33.7 46.9
BELGIUM 53 54.9 52.4 59.4
BULGARIA 27.7 31.7 22 31.7
CYPRUS 18.6 20 6.3 27
CZECK REPUBLIC 31.1 29.1 29.1 34.4
GERMANY 53 49.6 42.7 55.3
DENMARK 49.7 48.3 43 62.3
ESTONIA 23.4 24 22.5 24
GREECE 23.6 19.6 16 40.4
SPAIN 25.9 28.8 6.3 32.6
FINLAND 41.8 44.8 34.4 49.9
FRANCE 36.5 31.6 29.5 41.7
HUNGARY 44.2 40 35 57
IRELAND 35.7 37.6 24 47
ITALY 38.7 38.4 36.5 46.9
LITHUANIA 28.1 30 30 30
LUXEMBOURG 39.1 40.2 28.4 46.7
LATVIA 31 31.8 31.8 31.8
MALTA 26 25 21 35
NETHERLANDS 40.6 44.2 34.3 51.5
POLAND 31.9 35.2 32.9 35.2
PORTUGAL 26.6 24 11 34.5
ROMANIA 35 30.3 30.3 32.3
SWEDEN 38.6 31.9 31.9 51.8
SLOVENIA 32.9 32.6 27 40.7
SLOVAKIA 27.7 29.9 28.7 29.9
UNITED KINGDOM 39.4 34.4 33 41.1
  1. Source: EUROMOD F6.20.

Table A2
Proportion of METRs above 50% by deciles of equivalised disposable income, 2007.
N. Obs Prop. DECILES
1 2 3 4 5 6 7 8 9 10
AUSTRIA 575 9.3 18.0 11.6 9.3 7.1 9.4 9.2 9.8 7.7 7.9 10.1
BELGIUM 5,136 79.2 1.4 2.3 3.7 6.3 9.1 11.0 13.4 15.4 18.1 19.4
BULGARIA 44 0.9 88.6 1.8 2.6 0.0 4.0 0.0 0.0 0.0 3.0 0.0
CYPRUS 116 2.8 12.4 16.8 24.2 12.5 9.9 6.4 3.5 6.4 1.0 6.6
CZECK REPUBLIC 310 2.9 56.0 13.4 4.4 2.5 2.1 3.6 10.8 5.5 0.5 1.2
GERMANY 6,048 47.7 6.2 7.8 4.3 6.8 9.3 11.2 14.0 14.7 15.1 10.7
DENMARK 3,136 35.9 1.2 3.2 4.4 6.3 6.4 7.7 10.2 15.0 19.7 26.0
ESTONIA 96 1.6 96.7 3.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
GREECE 67 1.0 0.0 0.0 0.0 0.0 5.2 8.1 10.4 8.3 22.6 45.5
SPAIN 300 1.7 79.0 6.2 3.6 1.7 3.4 2.9 1.0 0.3 1.1 0.9
FINALND 2,901 15.7 10.3 8.4 4.8 5.1 3.1 3.9 5.9 7.2 15.6 35.8
FRANCE 1,321 12.2 23.0 17.9 19.3 9.1 8.8 8.4 6.4 3.3 1.7 2.1
HUNGARY 4,068 43.0 3.8 3.6 5.3 6.4 6.4 8.0 10.5 14.0 17.8 24.1
IRELAND 711 15.6 5.2 16.9 11.2 8.2 5.8 7.1 12.1 7.4 12.6 13.5
ITALY 2,263 10.0 1.5 6.8 9.8 8.8 8.3 7.7 11.1 13.6 14.4 18.0
LITHUANIA 31 0.6 75.6 20.7 0.0 0.8 0.0 0.0 0.0 0.0 2.9 0.0
LXEMBOURG 459 6.8 52.5 14.6 4.0 0.3 3.3 3.8 2.4 3.6 7.9 7.8
LATVIA 110 104 94.5 5.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
MALTA 115 2.9 15.5 6.1 11.6 6.5 11.2 22.0 13.3 4.5 4.0 5.2
NETHERLANDS 3?311 26.2 7.7 8.2 10.3 10.9 8.2 7.0 7.8 7.9 9.8 22.2
POLAND 284 1.7 46.8 17.4 11.3 8.4 2.2 1.3 0.7 0.0 0.0 12.0
PORTUGAL 197 4.0 53.2 21.5 1.3 3.2 1.7 2.9 2.8 3.6 1.6 8.4
ROMANIA 680 9.1 54.2 16.4 10.2 4.7 5.5 2.7 3.4 2.7 0.2 0.0
SWEDEN 3?274 32.5 9.3 4.4 4.7 3.7 5.1 6.1 8.2 12.4 17.8 28.4
SLOVENIA 2,237 14.8 13.6 4.5 2.4 2.5 1.2 3.0 2.8 7.2 20.6 42.1
SLOVAKIA 170 2.0 64.9 11.0 6.2 2.5 3.5 5.4 3.6 0.8 2.1 0.0
UNITED KINGDOM 3,860 15.8 10.3 19.0 22.0 16.1 12.3 8.5 4.6 3.4 1.9 1.9
  1. Note: The first column on the left reports the total number of observation with METR above 50%; the second column reports the proportion of earners with METR above 50%; the following columns reports the distribution of high METRs across deciles of equivalised disposable income.

  2. Source: EUROMOD F6.20.

Download links

A two-part list of links to download the article, or parts of the article, in various formats.

Downloads (link to download the article as PDF)

Download citations (links to download the citations from this article in formats compatible with various reference manager tools)

Open citations (links to open the citations from this article in various online reference manager services)