Kingdom of the Netherlands: Netherlands: Selected Issues-The Labor Income Tax Credit in an International Perspective

July 6, 2001

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Kingdom of the Netherlands: Netherlands: Selected Issues-The Labor Income Tax Credit in an International Perspective, (USA: International Monetary Fund, 2001) accessed November 23, 2024

Summary

Compared with its U.S. and U.K. counterparts, the Labor Tax Credit (LTC) is likely to have more limited effects on incentives for primary-earners to enter the labor force, because of the smaller size of the credit. Any significant increase in the LTC to strengthen its effect on the still large poverty trap in the Netherlands is likely to be extremely expensive. Given the easy availability of part-time employment and the high marginal tax rates, the reduction in hours worked could be substantial in the Netherlands.

Subject: Credit, Labor, Marginal effective tax rate, Money, National accounts, Personal income, Tax allowances, Tax policy, Taxes

Keywords: CR, Credit, Earner, EITC, EITC offset, Full-time equivalent, Income, Income earner, ISCR, Labor income, Marginal effective tax rate, Per-capita income, Personal income, Tax allowances, Tax rate

Publication Details

Pages:

12
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2001/096
Stock No:

1NLDEA0032001
ISBN:

9781451829471
ISSN:

1934-7685

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