### Abstract

In an influential article by Young (Journal of Economic Theory, 1988, 44, 321-335), it is shown that the traditional equal sacrifice principles in taxation can be justified from a non-utilitarian perspective by proving that equal sacrifice is, in fact, a consequence of more primitive concepts of distributive justice. This result is obtained in a distribution theoretic setting where total revenue to be raised is fixed. The present paper studies the same question in a setting where the basic problem is to determine a tax function without any reference to the total tax revenue (a setting which is familiar from the theory of progressive taxation) and shows that (i) there exists a utility function (which is continuous and strictly increasing) relative to which all agents sacrifice equally if and only if the tax function is incentive preserving; and (ii) any convex (hence progressive) and incentive preserving tax function equalizes sacrifice relative to a utility function which is continuous, strictly increasing and concave.

Original language | English (US) |
---|---|

Pages (from-to) | 453-467 |

Number of pages | 15 |

Journal | Journal of Public Economics |

Volume | 58 |

Issue number | 3 |

DOIs | |

State | Published - 1995 |

### Fingerprint

### Keywords

- Equal sacrifice
- Progressive taxation
- Vertical inequity

### ASJC Scopus subject areas

- Economics and Econometrics
- Finance

### Cite this

*Journal of Public Economics*,

*58*(3), 453-467. https://doi.org/10.1016/0047-2727(94)01481-3

**On the principle of equal sacrifice in income taxation.** / Ok, Ahmet.

Research output: Contribution to journal › Article

*Journal of Public Economics*, vol. 58, no. 3, pp. 453-467. https://doi.org/10.1016/0047-2727(94)01481-3

}

TY - JOUR

T1 - On the principle of equal sacrifice in income taxation

AU - Ok, Ahmet

PY - 1995

Y1 - 1995

N2 - In an influential article by Young (Journal of Economic Theory, 1988, 44, 321-335), it is shown that the traditional equal sacrifice principles in taxation can be justified from a non-utilitarian perspective by proving that equal sacrifice is, in fact, a consequence of more primitive concepts of distributive justice. This result is obtained in a distribution theoretic setting where total revenue to be raised is fixed. The present paper studies the same question in a setting where the basic problem is to determine a tax function without any reference to the total tax revenue (a setting which is familiar from the theory of progressive taxation) and shows that (i) there exists a utility function (which is continuous and strictly increasing) relative to which all agents sacrifice equally if and only if the tax function is incentive preserving; and (ii) any convex (hence progressive) and incentive preserving tax function equalizes sacrifice relative to a utility function which is continuous, strictly increasing and concave.

AB - In an influential article by Young (Journal of Economic Theory, 1988, 44, 321-335), it is shown that the traditional equal sacrifice principles in taxation can be justified from a non-utilitarian perspective by proving that equal sacrifice is, in fact, a consequence of more primitive concepts of distributive justice. This result is obtained in a distribution theoretic setting where total revenue to be raised is fixed. The present paper studies the same question in a setting where the basic problem is to determine a tax function without any reference to the total tax revenue (a setting which is familiar from the theory of progressive taxation) and shows that (i) there exists a utility function (which is continuous and strictly increasing) relative to which all agents sacrifice equally if and only if the tax function is incentive preserving; and (ii) any convex (hence progressive) and incentive preserving tax function equalizes sacrifice relative to a utility function which is continuous, strictly increasing and concave.

KW - Equal sacrifice

KW - Progressive taxation

KW - Vertical inequity

UR - http://www.scopus.com/inward/record.url?scp=0001127135&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=0001127135&partnerID=8YFLogxK

U2 - 10.1016/0047-2727(94)01481-3

DO - 10.1016/0047-2727(94)01481-3

M3 - Article

AN - SCOPUS:0001127135

VL - 58

SP - 453

EP - 467

JO - Journal of Public Economics

JF - Journal of Public Economics

SN - 0047-2727

IS - 3

ER -