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The impact of demographic change on tax revenue

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Abstract

This paper stimulates the impact of demographic change on direct tax revenue for the Netherlands using extensive survey data and population projections. Projected demographic development in the Netherlands fits in well with the OECD mainstream. The analysis thus has a more general relevance. The simulations indicate a 27 percent rise in tax revenue until 2010 because of population growth and a relatively older labor force. After 2030, revenue falls as a consequence of a declining population and a rapidly rising share of the elderly. The authors also simulated a variant in which labor-force participation rates are set on the substantially higher OECD average. In this case, the increase in tax revenue almost doubles as compared to the base variant.

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Authors and Affiliations

  1. Leiden University, Netherlands

    Kees Goudswaard & Hans van de Kar

Authors
  1. Kees Goudswaard
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  2. Hans van de Kar
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Goudswaard, K., van de Kar, H. The impact of demographic change on tax revenue. Atlantic Economic Journal 22, 52–60 (1994). https://doi.org/10.1007/BF02301798

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  • DOI: https://doi.org/10.1007/BF02301798

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