Budgetary Costs Of Tax Facilities For Pension Savings: An Empirical Analysis
A wide variety of tax regimes for (occupational) private pension saving are in place around the world. Generally, pension saving is taxed at a relatively low rate, although the revenue loss due to tax facilities for pension savings and/or pension tax expenditures may differ across countries. A strong fiscal stimulus to build up pension capital will support funding. However, these tax facilities may become an expensive business for governments. This paper investigates the ex ante budgetary effects of a cash-flow tax regime for pension savings by full present-value calculations.