PROGRESSIVITY VERSUS A FLAT TAX RATE IN COMBATING SOCIAL INEQUALITY?

On the automatic stabilization capabilities of the progressive tax regimes much has been written and argued. Equally, the flat tax rate has often been indicated as a promoter and stimulator of business, but also as a factor for the perpetuation and widening of social inequalities. Therefore, the article reproduces some of the themes of previous articles trying to discern between the qualities and defects of the two types of taxation regimes: progressive or single quota. The empirical analysis on the data gathered for the EU28 countries following the two tax regimes is interesting and surprising and deserves further reflection. This analysis supports the results shown in the literature on progressive tax regimes, but equally points to a number of key tax elements that use the flat tax rate, investigating whether or not it acts as a regressive tax by its effect on the Gini coefficient.