Hostname: page-component-7bb8b95d7b-495rp Total loading time: 0 Render date: 2024-09-11T22:20:19.988Z Has data issue: false hasContentIssue false
  • English
  • Français

Some Aspects of the Progressive Income Tax Structure in the UK

Published online by Cambridge University Press:  26 March 2020

R. W. R. Price
R. W. R. Price*
Affiliation:
National Institute of Economic and Social Research
Get access Rights & Permissions [Opens in a new window]

Extract

The yield of income tax varies automatically with movements in personal income as well as with discretionary changes in tax rates and allowances. In forecasting and for historical appraisal of fiscal policy there is a need to specify the automatic relationship between tax and income movements. In the former case this means specifying an accurate direct tax function in the forecasting model (i.e., identifying endogenous tax movements). From the descriptive, historical, point of view, it is possible to use such a function both to understand the ‘built-in’ properties of the budgetary system and, at the same time, to create a more complete picture of budgetary intervention than is given by the treatment of discretionary changes alone as indicators of fiscal policy. The latter procedure, which arises from the traditional British approach to budget-making (while not necessarily an inaccurate way of formulating policy), does tend to prevent an accurate picture of the complete Government intervention being formed by observers, and may result in expenditure, tax and monetary decisions being taken and analysed in a fragmented framework.

Type
Articles
Information
National Institute Economic Review , Volume 65 , August 1973 , pp. 52 - 63
Copyright
Copyright © 1973 National Institute of Economic and Social Research

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Balopoulos, E.T., Fiscal policy models of the British economy, Amsterdam, North Holland Publishing Company, 1967.Google Scholar
Brown, E.C., ‘Fiscal Policy in the Thirties: A Reappraisal’, American Economic Review, Vol. 46, September 1956, pp. 875–879.Google Scholar
Brown, E.C. and Kruizenga, R.J., ‘Income Sensitivity of a Simple Personal Income Tax’, Review of Economics and Statistics, Vol. 41, August 1959, pp. 260–269.CrossRefGoogle Scholar
Clement, M.O., ‘The Quantitative Impact of Automatic Stabilizers’, Review of Economics and Statistics, Vol. 24, February 1960, pp. 56–61.CrossRefGoogle Scholar
Cohen, L., ‘An Empirical Measurement of the Built-in Flexibility of the Individual Income Tax’, American Economic Review, Papers and Proceedings, Vol. 49, May 1959, pp. 532–541.Google Scholar
Dorrington, J. and Renton, G.A., ‘A Study of the Effects of direct Taxation on Consumers' Expenditure’, Conference on Modelling of the U.K. Economy, London Business School, 3-6 July, 1972.Google Scholar
Dow, J.C.R., The management of the British economy, Cambridge, Cambridge University Press, 1964, pp. 190–196.Google Scholar
Eilbott, P., ‘The Effectiveness of Automatic Stabilizers’, American Economic Review, Vol. 56, June 1966, pp. 450–465.Google Scholar
Friedman, M., ‘A Monetary and Fiscal Framework for Economic Stability’, American Economic Review, Vol. 38, June 1948, pp. 245–264.Google Scholar
Bent Hansen, Fiscal policy in seven countries, 1955-65, Paris, OECD, 1969.Google Scholar
Kaldor, N., ‘A Critique of the Green Paper Proposals’, Select Committee on Tax Credit, Session 1972-73, Minutes of Evidence, 29 March 1973, pp. 211–218.Google Scholar
Lusher, D.W., ‘The Stabilizing Effectiveness of Budget Flexibility’, in National Bureau of Economic Research, Policies to combat the depression, Princeton, Princeton University Press, 1956, pp. 77–89.Google Scholar
Mishan, E.J. and Dicks-Mireaux, L.A., ‘Progressive Taxation in an Inflationary Economy’, American Economic Review, Vol. 48, September 1958, pp. 590–606.Google Scholar
Morawetz, D., ‘The Sensitivity of the yield of Personal Income Tax in the United Kingdom: A Note’, Economic Journal, Vol. 81, no. 323, September 1971, pp. 612–616.CrossRefGoogle Scholar
Musgrave, R., The theory of public finance, New York, 1959.CrossRefGoogle Scholar
Musgrave, R. and Miller, M.H., ‘Built-in Flexibility’, American Economic Review, Vol. 38, March 1948, p. 122–128.Google Scholar
Pearse, R.H., ‘Automatic Stabilisation and the British Taxes on Income’, Review of Economic Studies, Vol. 29, February 1962, pp. 124–139.CrossRefGoogle Scholar
Prest, A.R., ‘Inflation and the Public Finances’, Three Banks Review, No. 96, March 1973, pp. 3–29.Google Scholar
Prest, A.R., ‘The Sensitivity of the Yield of Personal Income Tax in the United Kingdom’, Economic Journal, Vol. 72, No. 287, pp. 576–596.CrossRefGoogle Scholar
Stein, H., The fiscal revolution in America, Chicago, University of Chicago Press, 1969.Google Scholar
White, Melvin I., ‘Comment’ [on Prest's paper], American Economic Review, Papers and Proceedings, Vol. 52, May 1962, pp. 353–355.Google Scholar