Distribution of personal income tax changes in Slovenia

Abstract

Slovenia belongs to a group of EU member states that have reduced their personal income tax burden during the current financial and economic crisis. The latest changes, introduced in the personal income tax system during the last two years, have primarily reduced the tax burden on low-income taxpayers. However, this was only the last step in a series of personal income tax reforms since 2004 that have on average reduced the tax burden on all taxpayers. Using an exclusive database of taxpayers and utilising a general-equilibrium modelling platform, we assess the consequences of these reforms at both the micro and the macro level. From a macroeconomic point of view, the initial positive consequences of higher private consumption and welfare are declining over time due the increased budget deficit and reduced investment.

Switching personal income tax and social security contributions between Slovenia and the Federation of Bosnia and Herzegovina

“…Consequently, the current tax systems in both countries are different and hardly resemble the common ex-Yugoslavian basis. While Slovenia shaped its tax KEYWORDS Redistributive effects; income tax; policy switching; income inequality; tax progressivity; microsimulation system towards a highly progressive PIT (Čok, Sambt, Košak, Verbič, & Majcen, 2012;Majcen, Verbič, Bayar, & Čok, 2009), the FBH accepted a flat PIT concept. SSC also experienced divergent movements: ratio between the employers (10.5%) and employee rate (31.0%) in the FBH is more biased towards the employees than in Slovenia (16.1% versus 22.1%).…”