Advertisement

The rise of modern taxation: A new comprehensive dataset of tax introductions worldwide

  • Laura SeelkopfEmail author
  • Moritz Bubek
  • Edgars Eihmanis
  • Joseph Ganderson
  • Julian Limberg
  • Youssef Mnaili
  • Paula Zuluaga
  • Philipp Genschel
Article

Abstract

This article describes the new Tax Introduction Dataset (TID). Listing the year and the mode of the first permanent introduction of six major taxes (inheritance tax, personal income tax, corporate income tax, social security contributions, general sales tax and value added tax) in 220 countries, 1750–2018, TID is the most comprehensive dataset of its kind. The comprehensiveness of our measure is of critical value to empirical work on the causes of tax innovation and its consequences for state, society and economy. In this paper, we explain the selection of our tax sample and the structure of the dataset, descriptively map temporal and regional patterns of tax introductions around the world, and draw on TID to investigate associations between tax introductions and economic development, war, and democratization.

Keywords

Fiscal sociology Tax introduction dataset Economic development War Democratization Globalization State building 

Notes

Acknowledgements

The authors would like to thank Guy Whitten, Florian Hollenbach, Christine Lipsmeyer, Didac Queralt, Pablo Beramendi, Melissa Rogers,Carles Boix, José Cheibub, Lucy Martin, Ken Scheve, Hilary Appel, Ewout Frankema, Klaus Schlichte, Suthan Krishnarajan, participants at EPSA 2017/8, ECPR 2018, workshops in Bremen and Vienna, as well as Axel Dreher and three anonymous referees for very helpful comments. The authors gratefully acknowledge funding by the EUI Research Council, 2016–2018, the Robert Schuman Centre for Advanced Studies, and the School of Transnational Governance.

Supplementary material

11558_2019_9359_MOESM1_ESM.pdf (1.2 mb)
ESM 1 (PDF 1.16 mb)
11558_2019_9359_MOESM2_ESM.do (2 kb)
ESM 2 (DO 2 kb)
11558_2019_9359_MOESM3_ESM.csv (106 kb)
ESM 3 (CSV 106 kb)
11558_2019_9359_MOESM4_ESM.rds (79 kb)
ESM 4 (RDS 78 kb)
11558_2019_9359_MOESM6_ESM.dta (109 kb)
ESM 6 (DTA 109 kb)
11558_2019_9359_MOESM7_ESM.docx (395 kb)
ESM 7 (DOCX 395 kb)

References

  1. Acemoglu, D., & Robinson, J. A. (2000). Why did the west extend the franchise? Democracy, inequality, and growth in historical perspective. The Quarterly Journal of Economics, 115(4), 1167–1199.Google Scholar
  2. Acemoglu, D., & Robinson, J. A. (2001). A theory of political transitions. American Economic Review, 938–963.Google Scholar
  3. Acemoglu, D., & Robinson, J. A. (2006). Economic origins of dictatorship and democracy. Cambridge University Press.Google Scholar
  4. Aidt, T. S., & Jensen, P. S. (2009a). Tax structure, size of government, and the extension of the voting franchise in Western Europe, 1860–1938. International Tax and Public Finance, 16(3), 362–394.Google Scholar
  5. Aidt, T. S., & Jensen, P. S. (2009b). The taxman tools up: An event history study of the introduction of the personal income tax. Journal of Public Economics, 93(1–2), 160–175.Google Scholar
  6. Alesina, A., & Spolaore, E. (1997). On the number and size of nations. The Quarterly Journal of Economics, 112(4), 1027–1056.Google Scholar
  7. Alm, J., Jackson, B. R., & McKee, M. (1993). Fiscal exchange, collective decision institutions, and tax compliance. Journal of Economic Behavior & Organization, 22(3), 285–303.Google Scholar
  8. Andersson, P. (2017). “Taxation in non-democratic states: Investments vs. redistribution.” In: Pathways to modern taxation - European University Institute. Florence.Google Scholar
  9. Andersson, P., and Brambor, T. (2018). “Financing the state - central government revenues, 1800–2012 (dataset),” 2018. www.reformcapacity.org/data. Accessed 25 Feb 2018.
  10. Appel, H., & Orenstein, M. A. (2013). Ideas versus resources explaining the flat tax and pension privatization revolutions in Eastern Europe and the former Soviet Union. Comparative Political Studies, 46(2), 123–152.Google Scholar
  11. Ardant, G. (1975). Financial policy and economic infrastructure of modern states and nations. The Formation of National States in Western Europe, 164, 218.Google Scholar
  12. Bartels, L. M. (2005). Homer gets a tax cut: Inequality and public policy in the American mind. Perspectives on Politics, 3(1), 15–31.Google Scholar
  13. Bastiaens, I., & Rudra, N. (2016). Trade liberalization and the challenges of revenue mobilization: Can international financial institutions make a difference? Review of International Political Economy, 23(2), 261–289.Google Scholar
  14. Baumol, W. J. (1993). Health care, education and the cost disease: A looming crisis for public choice. Public Choice, 77(1), 17–28.Google Scholar
  15. Beck, N., Katz, J. N., & Tucker, R. (1998). Taking time seriously: Time-series-cross-section analysis with a binary dependent variable. American Journal of Political Science, 42(4), 1260–1288.Google Scholar
  16. Beramendi, P., & Rueda, D. (2007). Social democracy constrained: Indirect taxation in industrialized democracies. British Journal of Political Science, 37(4), 619–641.Google Scholar
  17. Besley, T., & Persson, T. (2009). The origins of state capacity: Property rights, taxation, and politics. The American Economic Review, 99(4), 1218–1244.Google Scholar
  18. Besley, T., and Persson, T. (2011). Pillars of prosperity: The political economics of development clusters. Princeton University Press.Google Scholar
  19. Besley, T., and Persson, T. (2013). “Taxation and development.” In Handbook of public economics, 5:51–110. Elsevier.Google Scholar
  20. Boix, C. (2003). Democracy and redistribution. Cambridge: Cambridge University Press.Google Scholar
  21. Bonoli, G. (1997). Classifying welfare states: A two-dimension approach. Journal of Social Policy, 26(3), 351–372.Google Scholar
  22. Borge, L.-E., & Rattsø, J. (2004). Income distribution and tax structure: Empirical test of the Meltzer–Richard hypothesis. European Economic Review, 48(4), 805–826.Google Scholar
  23. Brambor, T. (2016). “Fiscal capacity and the enduring legacy of the first income tax law.” In ECPR joint sessions of workshops 2015.Google Scholar
  24. Brewer, J. (1990). The sinews of power: War, money, and the English state, 1688–1783. Harvard University Press.Google Scholar
  25. Brülhart, M., & Parchet, R. (2014). Alleged tax competition: The mysterious death of bequest taxes in Switzerland. Journal of Public Economics, 111, 63–78.Google Scholar
  26. Carter, D. B., & Signorino, C. S. (2010). Back to the future: Modeling time dependence in binary data. Political Analysis, 18(3), 271–292.Google Scholar
  27. Centeno, M. A. (2003). Blood and debt: War and the nation-state in Latin America. Penn State Press.Google Scholar
  28. Charlet, A., & Buydens, S. (2012). The OECD international VAT/GST guidelines: Past and future developments. World Journal of VAT/GST Law, 1(2), 175–184.Google Scholar
  29. Cheibub, J. A. (1998). Political regimes and the extractive capacity of governments: Taxation in democracies and dictatorships. World Politics, 50(3), 349–376.Google Scholar
  30. Chile. (1924). “Ley no 4054 sobre Seguros de Enfermedad, Invalidez y Accidentes de Trabajo.”Google Scholar
  31. Correlates of War Project. (2017). “State system membership list (V2016).” Folder. 2017. http://correlatesofwar.org. Accessed 15 Dec 2017.
  32. Davis, S. L. (1992). IRS historical fact book: A chronology (pp. 1646–1992). Washington, DC: Internal Revenue Service, Department of Treasury.Google Scholar
  33. Deloitte. (2017). “Tax guides and country highlights.” 2017. https://dits.deloitte.com/#TaxGuides. Accessed 25 Feb 2018.
  34. Dincecco, M., & Katz, G. (2016). State capacity and long-run economic performance. The Economic Journal, 126(590), 189–218.Google Scholar
  35. Dincecco, M., & Prado, M. (2012). Warfare, fiscal capacity, and performance. Journal of Economic Growth, 17(3), 171–203.Google Scholar
  36. Dincecco, M., Federico, G., & Vindigni, A. (2011). Warfare, taxation, and political change: Evidence from the Italian Risorgimento. The Journal of Economic History, 71(4), 887–914.Google Scholar
  37. Esping-Andersen, G. (1990). The three worlds of welfare capitalism. Princeton: Princeton University Press.Google Scholar
  38. Financial Tribune. (2017). “VAT to give way to consumption tax.” Financial Tribune, February 5, 2017.Google Scholar
  39. Flora, P. (1983). The growth of mass democracies and welfare states. Campus Verlag.Google Scholar
  40. Frankema, E., & van Waijenburg, M. (2014). Metropolitan blueprints of colonial taxation? Lessons from fiscal capacity building in British and French Africa, c. 1880-1940. The Journal of African History, 55(03), 371–400.Google Scholar
  41. Ganghof, S. (2006). The politics of income taxation: A comparative analysis. ECPR Press.Google Scholar
  42. Ganghof, S. (2007). The political economy of high income taxation: Capital taxation, path dependence, and political institutions in Denmark. Comparative Political Studies, 40(9), 1059–1084.Google Scholar
  43. Gapminder Foundation. 2015. “Gapminder world, gross domestic product per capita by purchasing power parities 2015.” 2015. http://www.temoa.info/node/150/apa. Accessed 24 Sept 2017.
  44. Gardner, L. (2012). Taxing colonial Africa: The political economy of British imperialism. Oxford University Press.Google Scholar
  45. Gennaioli, N., & Voth, H.-J. (2015). State capacity and military conflict. The Review of Economic Studies, 82(4), 1409–1448.Google Scholar
  46. Genovese, F., Scheve, K., and Stasavage, D.. (2016). “Comparative income taxation database.” Stanford.Google Scholar
  47. Genschel, P., & Schwarz, P. (2011). Tax competition: A literature review. Socio-Economic Review, 9(2), 339–370.Google Scholar
  48. Genschel, P., & Seelkopf, L. (2016). Did they learn to tax? Taxation trends outside the OECD. Review of International Political Economy, 23(2), 316–344.Google Scholar
  49. Genschel, P., Lierse, H., & Seelkopf, L. (2016). Dictators Don’t compete: Autocracy, democracy, and tax competition. Review of International Political Economy, 23(2), 290–315.Google Scholar
  50. Genschel, P., & Seelkopf, L. (2019). Codebook - Tax Introduction Dataset Version May 2019. https://www.tid.seelkopf.eu
  51. Genser, B., & Reutter, A. (2007). Moving towards dual income taxation in Europe. FinanzArchiv: Public Finance Analysis, 63(3), 436–456.Google Scholar
  52. Gouveia, M., & Masia, N. A. (1998). Does the median voter model explain the size of government?: Evidence from the states. Public Choice, 97(1–2), 159–177.Google Scholar
  53. Grafe, R., & Irigoin, M. A. (2006). The Spanish empire and its legacy: Fiscal redistribution and political conflict in colonial and post-colonial Spanish America. Journal of Global History, 1(2), 241–267.Google Scholar
  54. Haffert, L., and Mertens, D. (2017). “Between distribution and allocation: Growth models, sectoral coalitions and the politics of taxation revisited.” Harvard CES.Google Scholar
  55. Hinrichs, H. H. (1966). A general theory of tax structure change during economic development. Cambridge: Law School of Harvard University.Google Scholar
  56. Hintze, O. (1906). “Military organization and the Organization of the State.”Google Scholar
  57. Hoffman. (1994). “Early modern France, 1450–1700.” In P. T. Hoffman and K. Norberg (ed.) Fiscal crises, liberty, and representative government, 1450–1789. Stanford University Press.Google Scholar
  58. ICTD/UNU-WIDER. (2017). “Government revenue dataset.” UNU-WIDER. 2017. https://www.wider.unu.edu/project/government-revenue-dataset.
  59. International Tax Dialogue. (2013). Review of International Tax Dialogue, Key Issues and Debates in VAT, SME Taxation and the Tax Treatment of the Financial Sector, by a Carter. International Tax Dialogue.Google Scholar
  60. Kato, J. (2003). “Regressive taxation and the welfare state: Path dependence and policy diffusion.” Cambridge Core. September 2003.Google Scholar
  61. Keen, M., & Lockwood, B. (2010). The value added tax: Its causes and consequences. Journal of Development Economics, 92(2), 138–151.Google Scholar
  62. Kemmerling, A. (2014). How labour ended up taxing itself and why it matters: The long-term evolution of politics in German labour taxation. Journal of European Social Policy, 24(2), 150–163.Google Scholar
  63. Kenny, L. W., & Winer, S. L. (2006). Tax Systems in the World: An empirical investigation into the importance of tax bases, administration costs, scale and political regime. International Tax and Public Finance, 13(2–3), 181–215.Google Scholar
  64. Kiser, E., & Karceski, S. M. (2017). Political economy of taxation. Annual Review of Political Science, 20(1), 75–92.Google Scholar
  65. Kiser, E., & Linton, A. (2001). Determinants of the growth of the state: War and taxation in early modern France and England. Social Forces, 80(2), 411–448.Google Scholar
  66. Levi, M. (1989). Of rule and revenue. University of California Press.Google Scholar
  67. Lieberman, E. S. (2002). Taxation data as indicators of state-society relations: Possibilities and pitfalls in cross-National Research. Studies in Comparative International Development, 36(4), 89–115.Google Scholar
  68. Lierse, H., & Seelkopf, L. (2014). Tax Introduction Database (TID). Version 13.11.2014Google Scholar
  69. Lynch, F. (2013). “The Haig-Shoup Mission to France in the 1920s.” In W. Elliot Brownlee, E. Ide, and Y. Fukagai (ed.) The Political Economy of Transnational Tax Reform: The Shoup Mission to Japan in Historical Context. Cambridge University Press.Google Scholar
  70. Mann, M. (1993). The Sources of Social Power: Volume 2, The rise of classes and nation-states, 17601914. Cambridge University Press.Google Scholar
  71. Mares, I., & Queralt, D. (2015). The non-democratic origins of income taxation. Comparative Political Studies, 48(14), 1974–2009.Google Scholar
  72. Martin, I. W., Mehrotra, A. K., and Prasad, M. (2009). The new fiscal sociology: Taxation in comparative and historical perspective. Cambridge University Press.Google Scholar
  73. McCarty, N., and Pontusson, H. J.. (2011). “The political economy of inequality and redistribution.” In W. Salverda, B. Nolan, and T. M. Smeeding (ed.) The Oxford handbook of economic inequality. Oxford University Press.Google Scholar
  74. Meltzer, A. H., & Richard, S. F. (1981). A rational theory of the size of government. Journal of Political Economy, 89(5), 914–927.Google Scholar
  75. OECD. (2017). “Revenue statistics - OECD countries.” 2017. https://stats.oecd.org/index.aspx?DataSetCode=REV. Accessed 3 March 2017.
  76. Penndorf, B. (1930). “The relation of taxation to the history of the balance sheet.” Accounting Review, 243–251.Google Scholar
  77. Peters, B. G. (1991). The politics of taxation: A comparative perspective. Cambridge: Blackwell Pub.Google Scholar
  78. Piketty, T., & Saez, E. (2014) “Inequality in the Long Run.” Science 344(6186), 838–843.Google Scholar
  79. Plagge, A., Scheve, K., and Stasavage, D. (2010). “Comparative inheritance taxation database.” ISPS data archive. http://isps.yale.edu/research/data/d025.
  80. Przeworski, A., and et.al. (2013). “Political institutions and political events (PIPE) data set.” Department of Politics, New York University.Google Scholar
  81. PwC. (2017). “World wide tax summaries.” 2017. http://taxsummaries.pwc.com/uk/taxsummaries/wwts.nsf/ID/tax-summaries-home. Accessed 25 Feb 2018.
  82. Reid, T. R. (2017). A fine mess: A global quest for a simpler, fairer, and more efficient tax system. Penguin.Google Scholar
  83. Rixen, T. (2011). Tax competition and inequality: The case for global tax governance. Global Governance: A Review of Multilateralism and International Organizations, 17(4), 447–467.Google Scholar
  84. Sarkees, M. R., & Wayman, F. W. (2010). Resort to war (pp. 1816–2007). Washington, D.C: CQ Press.Google Scholar
  85. Scheve, K., & Stasavage, D. (2010). The conscription of wealth: Mass warfare and the demand for progressive taxation. International Organization, 64(04), 529–561.Google Scholar
  86. Scheve, K., & Stasavage, D. (2012). Democracy, war, and wealth: Lessons from two centuries of inheritance taxation. American Political Science Review, 106(01), 81–102.Google Scholar
  87. Scheve, K., & Stasavage, D. (2016). Taxing the rich: A history of fiscal fairness in the United States and Europe. Princeton: Princeton University Press.Google Scholar
  88. Schumpeter, J. A. (1917). The crisis of the tax state. International Economic Papers, 4, 5–38.Google Scholar
  89. Seelkopf, L., Lierse, H., & Schmitt, C. (2016). Trade liberalization and the global expansion of modern taxes. Review of International Political Economy, 23(2), 208–231.Google Scholar
  90. Seligman, E. R. A. (1914). The income tax: A study of the history, theory, and practice of income taxation at home and abroad. The Lawbook Exchange, Ltd.Google Scholar
  91. Slemrod, J. (2007). Cheating ourselves: The economics of tax evasion. Journal of Economic Perspectives, 21(1), 25–48.Google Scholar
  92. Spencer, H. (1898). Principles of sociology, the, Vol. ii. New York: D. Appleton & Company.Google Scholar
  93. Steinmo, S. (1993). Taxation and democracy: Swedish, British, and American approaches to financing the modern state. Yale University Press.Google Scholar
  94. Steinmo, S. (2003). The evolution of policy ideas: Tax policy in the 20th century. The British Journal of Politics and International Relations, 5(2), 206–236.Google Scholar
  95. Swank, D. (2006). Tax policy in an era of internationalization: Explaining the spread of neoliberalism. International Organization, 60(4), 847–882.Google Scholar
  96. Swank, D., & Steinmo, S. (2002). The new political economy of taxation in advanced capitalist democracies. American Journal of Political Science, 642–655.Google Scholar
  97. Tilly, C. (1990). “1990. Coercion, capital, and European states. AD 990.”Google Scholar
  98. Titmuss, R. (1958). Essays on the welfare state. London: Allen & Unwin.Google Scholar
  99. Wagner, R., & Weber, W. (1977). Wagner’s law, fiscal institutions, and the growth of government. National Tax Journal, 30(1), 59–68.Google Scholar
  100. Wahl, I., Kastlunger, B., & Kirchler, E. (2010). Trust in Authorities and Power to enforce tax compliance: An empirical analysis of the slippery slope framework. Law and Policy, 32(4), 383–406.Google Scholar
  101. Webber, C., & Wildavsky, A. (1986). A history of taxation and expenditure in the Western world (1st ed.). New York: Simon and Schuster.Google Scholar
  102. Williams, D. (1996). “Social Security Taxation.” In Tax Law Design and Drafting, edited by Victor Thuronyi. Vol. 1. International Monetary Fund.Google Scholar
  103. Yun-Casalilla, B. (2012). Introduction. The rise of fiscal states: A global history, 1500–1914. In B. Yun-Casalilla, P. K. O’Brien, & F. C. Comin (Eds.), The rise of fiscal states: A global history, 1500–1914 (pp. 1–36). Cambridge: Cambridge University Press.Google Scholar
  104. Zielinski, R. C. (2016). How states pay for wars. Cornell University Press.Google Scholar
  105. Zolt, E. M., & Bird, R. M. (2005). Redistribution via taxation: The limited role of the personal income tax in developing countries. UCLA Law Review, 52(September), 1627–1695.Google Scholar

Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2019

Authors and Affiliations

  • Laura Seelkopf
    • 1
    Email author
  • Moritz Bubek
    • 2
  • Edgars Eihmanis
    • 3
  • Joseph Ganderson
    • 3
  • Julian Limberg
    • 1
  • Youssef Mnaili
    • 3
  • Paula Zuluaga
    • 3
  • Philipp Genschel
    • 3
    • 4
  1. 1.Geschwister-Scholl-Institut für PolitikwissenschaftLudwig-Maximilians-Universität MünchenMunichGermany
  2. 2.LudwigsburgGermany
  3. 3.European University InstituteSan Domenico di FiesoleItaly
  4. 4.Jacobs University Bremen gGmbHBremenGermany

Personalised recommendations