%0 Journal Article
%A Sanz Sanz, José Félix
%A Arrazola-Vacas, María
%A Rueda-López, Nuria
%A Romero-Jordán, Desiderio
%T Reported gross income and marginal tax rates: estimation of the behavioural reactions of Spanish taxpayers
%D 2015
%@ 1466-4283
%U https://hdl.handle.net/20.500.14352/34202
%X This article estimates, for the Spanish personal income tax, the elasticity of reported gross income to marginal tax rates. The identification of this elasticity has been performed using the reform approved by Law 35/2006, which came into force in January 2007. The elasticities obtained suggest the existence of important efficiency costs, with significant regional differences. The average elasticity estimated for Spain as a whole is 0.676. However, this elasticity is highly dispersed throughout the Spanish administrative regions, which indicates the unequal power of distortion of the tax. Thus, households whose principal source of income is salary display an elasticity of 0.337, compared to 0.682 for households whose main income source comes from business or savings. Lastly, a positive correlation is also detected between elasticity and income level: an elasticity of 3.6 is reached for taxpayers with an annual gross income exceeding 100 000€.
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