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On the Regressivity of Gambling Taxes in Switzerland

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  • Dimitri Kohler

Abstract

In this study, the author assesses whether the gambling tax in Switzerland is regressive using a large, representative sample of the population and the reported gambling expenditures of the Swiss Health Survey 2007 (SHS 07). To analyze the tax incidence, the Suits index was constructed. This result is supported by a regression analysis, which highlights the income elasticity of gambling expenditures. The two measures provide converging results and demonstrate the regressive pattern of the gambling tax in Switzerland. As such, this taxation structure contributes to increased income inequality in Switzerland.

Suggested Citation

  • Dimitri Kohler, 2016. "On the Regressivity of Gambling Taxes in Switzerland," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 152(III), pages 193-208, September.
    • Handle: RePEc:ses:arsjes:2016-iii-1
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    References listed on IDEAS

    as
    1. Suits, Daniel B, 1977. "Measurement of Tax Progressivity," American Economic Review, American Economic Association, vol. 67(4), pages 747-752, September.
    2. Andrew C. Worthington, 2001. "Implicit Finance in Gambling Expenditures: Australian Evidence on Socioeconomic and Demographic Tax Incidence," Public Finance Review, , vol. 29(4), pages 326-342, July.
    3. William C. Rivenbark, 1998. "The Tax Incidence of Casino Gaming in Mississippi," Public Finance Review, , vol. 26(6), pages 583-598, November.
    4. Price, Donald I. & Novak, E. Shawn, 1999. "The Tax Incidence of Three Texas Lottery Games: Regressivity, Race, and Education," National Tax Journal, National Tax Association;National Tax Journal, vol. 52(4), pages 741-752, December.
    5. Volberg, R.A., 1994. "The prevalence and demographics of pathological gamblers: Implications for public health," American Journal of Public Health, American Public Health Association, vol. 84(2), pages 237-241.
    6. Price, Donald I. & Novak, E. Shawn, 1999. "The Tax Incidence of Three Texas Lottery Games: Regressivity, Race, and Education," National Tax Journal, National Tax Association, vol. 52(n. 4), pages 741-52, December.
    7. Jon D. Wisman, 2006. "State Lotteries: Using State Power to Fleece the Poor," Journal of Economic Issues, Taylor & Francis Journals, vol. 40(4), pages 955-966, December.
    8. Charles T. Clotfelter & Philip J. Cook, 1987. "Implicit Taxation in Lottery Finance," NBER Working Papers 2246, National Bureau of Economic Research, Inc.
    9. Eric Mottu, 1997. "Progressivité de l'impôt fédéral direct et de la TVA en Suisse," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 133(IV), pages 709-740, December.
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    More about this item

    Keywords

    gambling taxes; inequity; regressivity; incidence;
    All these keywords.

    JEL classification:

    • H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • I14 - Health, Education, and Welfare - - Health - - - Health and Inequality
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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