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Seminar

Correcting Beliefs about the Marginal Tax Rate: A Survey Experiment among Dutch Households

  • Location
    Erasmus University Rotterdam, E building, Kitchen/Lounge E1
    Rotterdam
  • Date and time

    April 03, 2025
    12:00 - 13:00

Abstract

Because of the complex Dutch income tax system, it can be difficult for people to correctly assess their marginal tax rate. Misperceptions of the marginal tax rates could lead to inefficient labour supply decisions. We conducted a survey experiment among respondents of the LISS panel to better understand what misperceptions people have and whether addressing those misperceptions can influence their labour supply decisions. In one treatment, we provide information on the modal marginal tax rates in three different income brackets. In another treatment, we refer to a website that allows them to calculate their marginal tax rate. In the third treatment, we combine the two. Joint paper with Robert Dur, Job Harms, and Arjan Non.