Apostel, A and O'Neill, DW (2022) A one-off wealth tax for Belgium: Revenue potential, distributional impact, and environmental effects. Ecological Economics, 196. 107385. ISSN 0921-8009
Abstract
Policymakers and economists are becoming increasingly concerned about wealth inequality. Here we estimate Belgium's wealth distribution — and based on this distribution — the revenue potential, distributional impact, and environmental effect of three proposals for a one-off Belgian wealth tax. Our method consists of (1) estimating the Belgian wealth distribution by extending survey data with a top-tail Pareto distribution based on a novel national rich list, and (2) combining the estimated wealth distribution with proposed tax configurations and published elasticities. There are four main results. First, the wealthiest 1% of households possess ~24% of total net wealth, substantially more than previous estimates suggest. Second, the revenue potential of a one-off tax is considerably higher than estimated by wealth tax advocates. Third, the distributional impact would be limited as the richest 1% of households would still possess at least 23% of total net wealth. Fourth, a one-off tax would likely reduce CO2 emissions by only 0.1–0.6%. Overall, our findings suggest a one-off wealth tax could finance over half of Belgium's COVID-19 costs, but would lead to only small reductions in wealth inequality and environmental impact. Ecological economists may therefore wish to pursue other policy proposals to achieve fair distribution and sustainable scale.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © 2022 Elsevier B.V. All rights reserved. This is an author produced version of an article published in Ecological Economics. Uploaded in accordance with the publisher's self-archiving policy. |
Keywords: | Wealth tax; Wealth distribution; Belgium; Environmental effect; Revenue potential; Distributional impact |
Dates: |
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Institution: | The University of Leeds |
Academic Units: | The University of Leeds > Faculty of Environment (Leeds) > School of Earth and Environment (Leeds) > Sustainability Research Institute (SRI) (Leeds) |
Depositing User: | Symplectic Publications |
Date Deposited: | 08 Apr 2022 11:54 |
Last Modified: | 14 Mar 2023 01:13 |
Status: | Published |
Publisher: | Elsevier |
Identification Number: | 10.1016/j.ecolecon.2022.107385 |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:185515 |
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