The effects of taxes on wealth inequality in Artificial Chemistry models of economic activity.

We consider a number of Artificial Chemistry models for economic activity and what consequences they have for the formation of economic inequality. We are particularly interested in what tax measures are effective in dampening economic inequality. By starting from well-known kinetic exchange models, we examine different scenarios for reducing the tendency of economic activity models to form unequal wealth distribution in equilibrium.

Reducing the Number of Children Entering Foster Care: Effects of State Earned Income Tax Credits.

Foster care caseloads, an indicator of child maltreatment, are increasing. Children living in poverty are significantly more likely to be reported to the child welfare system and are overrepresented in foster care. Thus, it is critical to identify prevention strategies that can stem the flow of foster care entries, particularly among populations at higher risk. We used variations in the adoption and refund status of state-level Earned Income Tax Credit (EITC), a socioeconomic policy intended to reduce poverty, to examine their effect on foster care entry rates. Fixed-effects models, accounting for year- and state-fixed effects, demonstrated that a refundable EITC was associated with an 11% decrease in foster care entries compared to states without a state-level EITC after controlling for child poverty rate, racial/ethnic composition, education, and unemployment. Policies that strengthen economic supports for families may prevent child maltreatment and reduce foster care entries and associated costs.

Quantifying Overinsurance Tied to the Tax Exclusion for Employment-Based Health Insurance and Its Variation by Health Status.

The exclusion of employment-based health insurance from income and payroll taxes is thought to increase the generosity of insurance coverage and, in turn, increase the overutilization of low-value health care services. We examine this inefficiency of overinsurance by quantifying the change in expected utility across 4 benchmark plans varying in actuarial value (AV) and focus on the distribution of each of these estimates across different groups of people varying in health status. Specifically, we quantify the changes in health care spending due to moral hazard and the changes in uncertainty tied to risk aversion using data from the nationally representative sample of adults with employment-based coverage from the 2007-2016 Medical Expenditure Panel Survey, and produce estimates of expected utility for 24 groups of people based on their age, gender, and preexisting conditions. Our model suggests an average preferred AV of 78% without the tax exclusion, with 29.0% of the population preferring a 60% AV, 6.5% preferring a 70% AV, 18.1% preferring an 80% AV, and 46.4% preferring a 90% AV. When incorporating the distortionary effect of the employment-based tax exclusion, the preferred plan increases to an 83% AV for low-income people (with 71.0% of the population preferring a 90% AV) and an 84% AV for high-income people (with 76.0% of the population preferring a 90% AV). We estimate that policy changes to make subsidies independent of a plan's AV could result in increases in utility equal to about 2.7% of total health care spending, but with those net gains concentrated among the healthy.

The Effect of the Earned Income Tax Credit on Housing and Living Arrangements.

As rents have risen and wages have not kept pace, housing affordability in the United States has declined over the last 15 years, impacting the housing and living arrangements of low-income families. Housing subsidies improve the housing situations of low-income families, but less than one in four eligible families receive a voucher. In this article, we analyze whether one of the largest anti-poverty programs in the United States-the Earned Income Tax Credit (EITC)-affects the housing (eviction, homelessness, and affordability) and living arrangements (doubling up, number of people in the household, and crowding) of low-income families. Using the Current Population Survey, the American Community Survey/decennial census, and the Fragile Families and Child Wellbeing Study, we employ a parameterized difference-in-differences strategy to examine whether policy-induced expansions to the EITC affect the housing and living arrangements of single mothers. Results suggest that a $1,000 increase in the EITC improves housing by reducing housing cost burdens, but it has no effect on eviction or homelessness. Increases in the EITC also reduce doubling up (living with additional, nonnuclear family adults)-in particular, doubling up in someone else's home-and reduce three-generation/multigenerational coresidence, suggesting that mothers have a preference to live independently. We find weak evidence for a reduction in overall household size, yet the EITC does reduce household crowding. Although the EITC is not an explicit housing policy, expansions to the EITC are generally linked with improved housing outcomes for single mothers and their children.

Does the earned income tax credit increase children's weight? The impact of policy-driven income on childhood obesity.

I exploit substantial increases in the earned income tax credit to study how a policy-driven change in family income affects childhood obesity. Using the National Longitudinal Survey of Youth 1979, my difference-in-differences estimates indicate that the probability of being obese increased by 3 percentage points among children whose families experienced a greater income shock. A further investigation suggests that a reduction in maternal time with children played a greater role in children's weight gain than income. The paper's finding shows that a program that is not designed for health purposes, such as earned income tax credit, can have unintended effects on health outcomes.

Rich and Well Educated: Are These Requirements Necessary to Claim Healthcare Tax Credits in Italy?

BACKGROUND: The paper investigates the use of healthcare tax credits (HTCs) in Italy through the analysis of a panel data, which provides information on individual income tax from 2008 to 2014. There is evidence of disparities in the per-capita HTCs between Northern and Southern regions, which need to be analyzed and addressed. OBJECTIVE: The aim of the paper is to investigate the socioeconomic determinants in the use of Healthcare Tax Credits in Italy. METHODS: A fixed effects Ordinary Least Square model is run to analyze the impact of selected socioeconomic variables on regional per capita HTCs, with a particular focus on the role of education. RESULTS: The results corroborate literature findings on the regressive effects of HTCs; they also provide highlights on the role of education in explaining the distribution of HTCs among Italian regions. CONCLUSION: Public money is reimbursed to regions where people are, on average, richer and better educated. More equitable objectives could be reached by allocating the same resources in the provision of services covered by the NHS.

What happens to the employment of disabled individuals when all financial disincentives to work are abolished?

Policymakers and organizations representing people with disabilities have highlighted the importance of promoting the employment prospects of disabled individuals as a determinant to ensure their broader integration into the society. Policy reforms that attempt to incentivise disabled individuals to work typically involve reduced financial punishments for earning above a predetermined threshold (substantial gainful activity). This paper exploits a Spanish reform that entirely eliminated any disincentives for disabled individuals to work. Partially disabled individuals in Spain are subject to income taxation in all regions except in the province of Bizkaia. Before 2007, partially disabled individuals in Bizkaia were exempt from income taxation if they did not work. In December 2006, a new law was passed in Bizkaia that distinguished between individuals aged 55 or younger, who were no longer tax-exempt, and those who were older than 55 years, who continued to be tax-exempt if they did not work. I exploit this change in the legislation and employ both a difference-in-difference strategy comparing the employment outcomes of disabled young men across provinces and time as well as a triple difference model with disabled men older than 55 years, who are unaffected by the policy. My results show that the reform increased the probability of working by 6.5 percentage points for disabled men aged 55 or younger.

Extending Marketplace Tax Credits Would Make Coverage More Affordable for Middle-Income Adults.

ISSUE: Affordability of health coverage is a growing challenge for Americans facing rising premiums, deductibles, and copayments. The Affordable Care Act's tax credits make marketplace insurance more affordable for eligible lower-income individuals. However, individuals lose tax credits when their income exceeds 400 percent of the federal poverty level, creating a steep cliff. GOALS: To analyze the effects of extending eligibility for tax credits to individuals with incomes above 400 percent of the federal poverty level. METHODS: We used RAND's COMPARE microsimulation model to examine changes in insurance coverage and health care spending. KEY FINDINGS AND CONCLUSIONS: Extending tax-credit eligibility increases insurance enrollment by 1.2 million, at a total federal cost of $6.0 billion. Those who would benefit from the tax-credit extension are mostly middle-income adults ages 50 to 64. These new enrollees would be healthier than current enrollees their age, which would improve the risk pool and lower premiums. Eliminating the cliff at 400 percent of the federal poverty level is one policy option that may be considered to increase affordability of insurance.

Effect of the Earned Income Tax Credit on Hospital Admissions for Pediatric Abusive Head Trauma, 1995-2013.

OBJECTIVES: Policies that increase household income, such as the earned income tax credit (EITC), have shown reductions on risk factors for child maltreatment (ie, poverty, maternal stress, depression), but evidence is lacking on whether the EITC actually reduces child maltreatment. We examined whether states' EITCs are associated with state rates of hospital admissions for abusive head trauma among children aged <2 years. METHODS: We conducted difference-in-difference analyses (ie, pre- and postdifferences in intervention vs control groups) of annual rates of states' hospital admissions attributed to abusive head trauma among children aged <2 years (ie, using aggregate data). We conducted analyses in 14 states with, and 13 states without, an EITC from 1995 to 2013, differentiating refundable EITCs (ie, tax filer gets money even if taxes are not owed) from nonrefundable EITCs (ie, tax filer gets credit only for any tax owed), controlling for state rates of child poverty, unemployment, high school graduation, and percentage of non-Latino white people. RESULTS: A refundable EITC was associated with a decrease of 3.1 abusive head trauma admissions per 100 000 population in children aged <2 years after controlling for confounders ( P = .08), but a nonrefundable EITC was not associated with a decrease ( P = .49). Tax refunds ranged from $108 to $1014 and $165 to $1648 for a single parent working full-time at minimum wage with 1 child or 2 children, respectively. CONCLUSIONS: Our findings with others suggest that policies such as the EITC that increase household income may prevent serious abusive head trauma.

Your Health Is Priceless.

Your health is priceless but health insurance can be expensive. As open enrollment begins, we show you how to avoid costly mistakes and still get the coverage you need.

Large tax rebates possible for thousands of nurses.

Nurses who took part in an NHS training scheme could be eligible for tax rebates that may be worth thousands of pounds.

Modification of Treatment of Certain Health Organizations. Final regulations.

This document contains final regulations that provide guidance to Blue Cross and Blue Shield organizations, and certain other organizations, on computing and applying the medical loss ratio and the consequences for not meeting the medical loss ratio threshold. The final regulations reflect the enactment of a technical correction to section 833(c)(5) of the Internal Revenue Code by the Consolidated and Further Continuing Appropriations Act of 2015. The final regulations affect Blue Cross and Blue Shield organizations, and certain other organizations involved in providing health insurance.

Minimum Value of Eligible Employer-Sponsored Plans and Other Rules Regarding the Health Insurance Premium Tax Credit. Final regulations.

This document contains final regulations on the health insurance premium tax credit enacted by the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010, as amended by the Medicare and Medicaid Extenders Act of 2010, the Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act of 2011, and the Department of Defense and Full-Year Continuing Appropriations Act, 2011. These final regulations affect individuals who enroll in qualified health plans through Affordable Insurance Exchanges (Exchanges, sometimes called Marketplaces) and claim the health insurance premium tax credit, and Exchanges that make qualified health plans available to individuals and employers.

The development of universal health insurance coverage in Thailand: Challenges of population aging and informal economy.

This paper quantitatively investigates the sustainability of the universal health insurance coverage (UHI) system in Thailand while taking into account the country's rapidly aging population and large informal labor sector. We examine the effects of population aging and informal employment across three tax options for financing the UHI. A modern dynamic general equilibrium framework is utilized to conduct policy experiments and welfare analysis. In the case of labor income tax being used to finance the cost of UHI, an additional 11-15% of labor tax will be required with the 2050 population age structure, compared with the 2005 benchmark economy. We also find that an expansion of income tax base to the informal sector can substantially alleviate the tax burden. Based on welfare comparisons across the alternative tax options, the labor income tax is the most preferred because the inequality between formal/informal sectors is large. If the informal sector cannot avoid labor income tax, capital tax will be preferred over labor and consumption taxes.

Emerging challenges in implementing universal health coverage in Asia.

As countries in Asia converge on the goal of universal health coverage (UHC), some common challenges are emerging. One is how to ensure coverage of the informal sector so as to make UHC truly universal; a second is how to design a benefit package that is responsive and appropriate to current health challenges, yet fiscally sustainable; and a third is how to ensure "supply-side readiness", i.e. the availability and quality of services, which is a necessary condition for translating coverage into improvements in health outcomes. Using examples from the Asia region, this paper discusses these three challenges and how they are being addressed. On the first challenge, two promising approaches emerge: using general revenues to fully cover the informal sector, or employing a combination of tax subsidies, non-financial incentives and contributory requirements. The former can produce fast results, but places pressure on government budgets and may induce informality, while the latter will require a strong administrative mandate and systems to track the ability-to-pay. With respect to benefit packages, we find considerable variation in the nature and rigor of processes underlying the selection and updating of the services included. Also, in general, packages do not yet focus sufficiently on non-communicable diseases (NCDs) and related preventive outpatient care. Finally, there are large variations and inequities in the supply-side readiness, in terms of availability of infrastructure, equipment, essential drugs and staffing, to deliver on the promises of UHC. Health worker competencies are also a constraint. While the UHC challenges are common, experience in overcoming these challenges is varied and many of the successes appear to be highly context-specific. This implies that researchers and policymakers need to rigorously, and regularly, assess different approaches, and share these findings across countries in Asia - and across the world.