Economic Impact of a “Flat” Tax. What have we learned from the Russian Experience?
by: Denvil Duncan
Russia flattened its personal income tax (PIT) schedule as part of a comprehensive tax reform in 2001. Tax revenues and compliance surged in the years following the reform, leading many to declare the reform a success. Since then, 28 countries have adopted the flat tax schedule and other countries continue to discuss the prospects, including the United States. This issue of Insights recaps the evidence on the performance of Russia’s flat tax and provides a brief discussion of the proposed optional flat taxes in the U.S.
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