Book chapter on Tax Policy and Fair Inequality forthcoming
Alexander Cappelen and Bertil Tungodden have written a chapter for the book ”Taxation and Political Philosophy” by Martin O’Neill and Shepley Orr (eds.), forthcoming in Oxford University Press.
In the chapter Tax Policy and Fair Inequality, Cappelen and Tungodden discuss the implications of a liberal egalitarian approach to tax policy and argue that such an approach avoids two fundamental challenges faced by the standard welfarist approach: the “exploitation of the hard working” and the “exploitation of the talented”.
They also argue that the liberal egalitarian approach is able to capture the distinction between fair and unfair inequalities in a way that the welfarist approach fails to do. A major challenge for the liberal egalitarian approach to tax policy, however, is that it requires information that typically is unavailable to tax authorities in order to be implemented. Cappelen and Tungodden argue that this approach still can be used in the evaluation of tax policies.