Use of simulation models for the tax reform in Slovenia

Cok, Mitja and Majcen, Boris and Verbic, Miroslav and Kosak, Marko (2008): Use of simulation models for the tax reform in Slovenia.

Abstract

In 2007 Slovenia launched a comprehensive reform of its tax system. To estimate the different proposals (including a flat-tax proposal) and their overall effect on individual taxpayers and government budget a static micro-simulation model was constructed and combined with a computable general equilibrium model. It uses a large, comprehensive database (6% of the population) provided by relevant ministries and government agencies and proved to be a reliable tool during implementation of the reform. In the paper, the main characteristics of both models are presented along with the results of different reform scenarios, including those which finally passed the parliament and now form part of the Slovenian tax system.

• Item Type: MPRA Paper
• Language: English
• Keywords: tax reform; personal income tax; income inequality; microsimulation; CGE
• Subjects: D - Microeconomics > D6 - Welfare Economics > D63 - Equity, Justice, Inequality, and Other Normative Criteria and Measurement; D - Microeconomics > D3 - Distribution > D31 - Personal Income, Wealth, and Their Distributions; H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H24 - Personal Income and Other Nonbusiness Taxes and Subsidies; H - Public Economics > H3 - Fiscal Policies and Behavior of Economic Agents > H30 - General; E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook > E60 - General

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