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DIW Discussion Papers 791 / 2008
In view of rising wage inequality and increasing poverty, the introduction of a legal minimum wage has recently become an important policy issue in Germany. We analyze the distributional effects of the introduction of a nationwide legal minimum wage of € 7.5 per hour on the basis of a microsimulation model which accounts for the complex interactions between individual wages, the tax-benefit system ...
2008| Kai-Uwe Müller, Viktor Steiner
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DIW Discussion Papers 790 / 2008
In this paper we develop a dynamic structural life-cycle model of labor supply behavior which fully accounts for the effects of income tax and transfers on labor supply incentives. Additionally, the model recognizes the demand side driven rationing risk that might prevent individuals from realizing their optimal labor supply state, resulting in involuntary unemployment. We use this framework to study ...
2008| Peter Haan, Victoria Prowse, Arne Uhlendorff
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DIW Discussion Papers 789 / 2008
School education in Germany is under the responsibility of the federal states and as a consequence average grades differ widely across regions. Since school leavers apply nationwide for admission to university, regional provenance may thus matter a lot for the success probability in the admission process. Using a comprehensive dataset of the German central clearing house for university admissions in ...
2008| Sebastian Braun, Nadja Dwenger
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DIW Discussion Papers 773 / 2008
When possible income tax reforms are debated, the suspected impact on entrepreneurship is often used as an argument in favour or against a certain policy. Quantitative ex-ante evaluations of the effect of certain tax reform options on entrepreneurship based on microeconometric research have not been provided by the literature, however. This paper estimates the ex-ante effects of the German tax reform ...
2008| Frank M. Fossen
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DIW Discussion Papers 769 / 2008
In the German system of fiscal equalization Länder (States) with tax revenue below the average get payments from the Länder above the average. The difference between the average and the own tax revenue per capita will be compensated up to 75%. To prevent Länder from getting payments form other Länder by lowering their own tax rates and to get the right information about their ability to pay, the revenue ...
2008| Michael Broer
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DIW Discussion Papers 768 / 2008
German corporated companies are taxed with a federal corporation tax and with a local busi-ness tax. The latter has a similar, but broader tax base (including e.g. 25% of interest pay-ments) and its tax rate is set independently by every municipality including the so called city-states (Stadtstaaten). The federal corporation tax revenue is equally split between the federal government and the federal ...
2008| Michael Broer
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DIW Discussion Papers 767 / 2008
We analyze the taxation of top personal incomes in Germany on the basis of an integrated data file of individual tax returns and a general household survey for the years 1992 - 2002. The unique feature of this integrated data set is that it includes all taxpayers in the top percentile of the gross income distribution. We show that despite substantial tax base erosion and significant reductions of top ...
2008| Stefan Bach, Giacomo Corneo, Viktor Steiner
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DIW Discussion Papers 766 / 2008
Local authorities charge supply companies with concession dues on gas, water and electricity (Konzessionsabgaben), which are similar to some local taxes (local business tax, real property tax). These taxes have already been included in the fiscal equalization system and in the future concession dues should be treated alike. Its importance in revenue terms is an additional reason for this: concession ...
2008| Michael Broer
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DIW Discussion Papers 765 / 2008
With the 2008 reform of business taxation (Unternehmensteuerreform 2008) a preferential treatment of retained earnings for non-incorporated companies was introduced: Earnings may be retained at a preferential tax rate (29.8%) and will be subjected to supplementary tax (26.4%) when they will be withdrawn in the future. By now, studies on this topic have been based on case studies. Our article is based ...
2008| Michael Broer, Nadja Dwenger
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DIW Discussion Papers 764 / 2008
In Germany, the tax loss carry-forward of corporations significantly increased over the last decade. At the same time only a small percentage of losses have been effectively offset in the following periods. One potential reason for this puzzle is that stricter loss offset restrictions have been introduced in recent years. I use a newly developed micro simulation model for the corporate sector in Germany ...
2008| Nadja Dwenger