Personal Income Tax Reforms: a Genetic Algorithm Approach

by Matteo Morini and Simone Pellegrino; CeRP WP 147/14

Abstract

Given a settled reduction in the present level of tax revenue, and by exploring a very large combinatorial space of tax structures, in this paper we employ a genetic algorithm in order to determine the ‘best’ structure of a real world personal income tax that allows for the maximization of the redistributive effect of the tax, while preventing all taxpayers being worse off than with the present tax structure. We take Italy as a case study.

published: December 2014

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