The name is absent

both reforms. Tax payers who benefit or (do not) from the tax reform are not uniformly
distributed throughout the income scale. The tax reform clearly benefits the two lowest
income groups. There are scarcely not losers at the bottom of the income distribution.
Percentages of 6.69% and 28% of tax payers from the first and second income deciles benefit
from the tax reform. Percentages of losers are significant for the remaining income deciles.
Regarding the population located between the 40% and 98% percentiles, losers percentages
are higher than gainers ones (see Table 4).

Table 4. Distribution of share and cumulated shares of pre-tax income,
taxable-income and gross-tax liability T by income deciles.

The distribution of losers comes mainly from the dual tax schedule designed. The change
of sociodemographic deductions from the ’income base system’ to ’tax credits’ system favors
low-income tax-payers. The rest of the population experiments an increase in the marginal
tax rate as a consequence of that change.

6 Conclusions

The distributive effects of a class of linear tax cuts (or tax increases) are established by Pfahler
(1984). His main results show that yield-equivalent tax cuts can be ranked according to a
social welfare criterion (Lorenz dominance). His analysis identifies the most redistributive
policy as the one which the initial residual progression of the tax. However when dual taxes
are concerned (where two tax functions are applied to different income bases), Pfahler’s
results need further development.

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