Hi Burak,

You raise an important issue with your question, namely addressing issues of unfairness in the tax system reflected in part by the gini coefficient, and how to develop the "fairest taxation system".

For an interesting proposal, you could look at the following a Canadian context: "Fairness by Design: A Framework for Tax Reform in Canada", by Marc Lee and Iglika Ivanova, (Canadian Centre for Policy Alternatives, February 2013).

In a NZ context you could look at: "Income inequality in New Zealand, 1935 – 2014", by John Creedy, Norman Gemmell, and Loc Nguyen, VUW Working paper 07/2017 (March 2017).

You could look further into research that utilises the gini coefficient in various jurisdictions.

Also, what is meant by "fair" is far from being an objective concept. You might also wish to research the various meanings of fairness and their associated application. There are numerous perspective you could take, which may in part depend upon your research training and "lenses" through which you view the world.

All the best with you research.

Adrian

Hi Burak,

You raise an important issue with your question, namely addressing issues of unfairness in the tax system reflected in part by the gini coefficient, and how to develop the "fairest taxation system".

For an interesting proposal, you could look at the following a Canadian context: "Fairness by Design: A Framework for Tax Reform in Canada", by Marc Lee and Iglika Ivanova, (Canadian Centre for Policy Alternatives, February 2013).

In a NZ context you could look at: "Income inequality in New Zealand, 1935 – 2014", by John Creedy, Norman Gemmell, and Loc Nguyen, VUW Working paper 07/2017 (March 2017).

You could look further into research that utilises the gini coefficient in various jurisdictions.

Also, what is meant by "fair" is far from being an objective concept. You might also wish to research the various meanings of fairness and their associated application. There are numerous perspective you could take, which may in part depend upon your research training and "lenses" through which you view the world.

All the best with you research.

Adrian

Dear Adrian;

Thank you very much for your detailed and informative reply in this very important question and subject.

I hope that many researchers will also share their answers and ideas too.

Have a nice day

Best Regards

Burak

Indeed, you need to clarify - to yourself! - what does "fair"means, how to measure "degrees of fairness", in order to search for an optimal solution which you call "fairest". What would be the criteria that will be applied in order to evaluate a tax system as "fair"? The literature on Public Sector Economics (Equity and Social Welfare in particular) is full of concepts in this respect.

Dear Venelin;

Your answer is very important.

You are right. I have something in my mind in this respect but modeling it is not simple.

I consider hunger and poverty limits on this respect "fairness".

I will first focus on this issue.

I hope that many researchers will also share their answers and ideas too.

Have a nice day

Best Regards

Burak

Dear Burak,

Consider adding employment taxes to the list of income and VAT tax studies you were looking for. The interplay between employment taxes and income taxes has led to notable US congressional testimony by, e.g. Warren Buffett who believes that his administrative assistant pays more in income taxes that he does. He considers that and unfairness of the US tax system.

For some interesting reading on the US tax system, look at Adam Smith’s Wealth of Nations and Joel Slemrod’s Taxing Ourselves.

Here is the venue shopping piece that I mentioned in an earlier response.

In my view, “hunger” would be a limited concept of economic hardship. A country like New Zealand (other examples could be quoted) will refrain from collecting tax arrears if that would cause

“significant financial difficulties that arise because of:

· the taxpayer's inability to meet minimum living expenses according to normal community standards; or

· the cost of medical treatment for an illness or injury of the taxpayer or the taxpayer's dependent(s); or

· a serious illness suffered by the taxpayer or the taxpayer's dependent(s); or

· the cost of education for the taxpayer's dependent(s).”

So poverty limits depend on the dependents, and their basic needs (not only food). Poverty research often defines poverty thresholds in terms of income, and then measures both the number of persons or households below the poverty line and the depth of their poverty. A model could be used to estimate the number of individuals or households that are pushed below the poverty line, because the tax exempt income level is too low, and/or the lowest marginal income tax rate is too high.

But poverty is not the same as inequality, and inequality is not the same as unfairness.

Dear Researchers;

"82% of the new wealth created has gone to top 1%, while 0% has gone to the world’s poorest 50%."

"almost half a billion people will still be living on less than $1.90 a day in 2030"

https://www.oxfam.org/en/even-it/5-shocking-facts-about-extreme-global-inequality-and-how-even-it-davos/

I think this is one of the main problems, that has to be solved,

I think the taxation functions may be a good research subject to simulate how they work to solve this problem.

To make enough very long term and long term liquidity in the financial institutions to invest in new real word investments and to support people, the different taxation functions should be studied very well. For instance: for "one" vehicle or flat or house per person or may be better per family "A" amount of tax

for "two" vehicles or flats or houses per person or may be better per family "B" amount of tax

for "three" vehicles or flats or houses per person or may be better per family "C" amount of tax

for "n" vehicle or flat or house per person or may be better per family "N" amount of tax

where

A