Allocative or Distributive Aims of Income Taxation?

Author: Schmidt K-H.

Source: European Journal of Law and Economics, Volume 10, Number 2, September 2000 , pp. 179-189(11)

Publisher: Springer

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Abstract:

Relations of income tax legislation and economic development are traditional subjects of German public finance. Reginald Hansen's book (1996) on practical consequences of the “Methodenstreit” for income taxation is considered under three aspects: history of economic thought, tax-systems and aims of income taxation. The introduction is followed by four paragraphs: 1. Long-term views of income taxation, 2. Reginald Hansen's comments on income taxation in Germany, 3. From Schmoller and Wagner to the modern German type of income taxation, 4. “Ability to pay,” “Pay as you use” or what else? The article demonstrates progressive and restrictive results of the long-term view focusing on the evaluation of income taxation principles.

Keywords: ability to pay; principles of income taxation; international comparisons of income taxation; functions of public finance policy; concepts of political economy; “German type” of income taxation

Language: English

Document Type: Regular paper

Affiliations: 1: Professor of Economics, Department of Economics, University of Paderborn, Warburger Straße 100, 33098 Paderborn, Germany karl_schmidt@notes.uni-paderborn.de

Publication date: 2000-09-01