A new OECD working paper looks at the potential of individual tax record microdata to support tax policy analysis.
With response rates to traditional surveys falling, the paper suggests future best-practice in tax policy analysis is likely to combine tax microdata with survey and national account data. The paper argues that tax microdata can:
deliver unique policy insights with simple statistical descriptions;
expand the range and depth of analysis available to tax policymakers;
help provide new answers to old tax policy questions including to what extent taxpayers move up and down the income ladder over time and to what degree will the income tax base be eroded in an era of ageing; and
define and focus on almost any taxpayer cohort while retaining sufficient sample size for analysis.
Limitations include little to no demographic information on taxpayers, inconsistent alignment with macroeconomic data and coverage of only the taxpaying, rather than the total population.
The paper draws on OECD collaborations with Slovenia and Ireland in 2018 where tax microdata was used.
A new OECD working paper looks at the potential of individual tax record microdata to support tax policy analysis.
With response rates to traditional surveys falling, the paper suggests future best-practice in tax policy analysis is likely to combine tax microdata with survey and national account data. The paper argues that tax microdata can:
deliver unique policy insights with simple statistical descriptions;
expand the range and depth of analysis available to tax policymakers;
help provide new answers to old tax policy questions including to what extent taxpayers move up and down the income ladder over time and to what degree will the income tax base be eroded in an era of ageing; and
define and focus on almost any taxpayer cohort while retaining sufficient sample size for analysis.
Limitations include little to no demographic information on taxpayers, inconsistent alignment with macroeconomic data and coverage of only the taxpaying, rather than the total population.
The paper draws on OECD collaborations with Slovenia and Ireland in 2018 where tax microdata was used.
