Size and structure of the tax state in comparative perspective

This chapter examines the tax regimes of advanced capitalist democracies. Focusing on differences in the overall size of the tax state and the composition of the tax mix, it discusses how these differences are related to differences in the broader institutional setup of advanced capitalist democracies. Building on a longstanding literature on the relationship between taxation and the welfare state, the chapter discusses how differences in the size of the tax state and differences in the tax mix are systematically related to differences between different welfare state regimes. Moreover, it reviews more recent contributions which have argued that differences in the tax mix are more related to differences between different national growth models. The chapter thus understands tax regimes as an important element of the institutional setup of national political economies. Accordingly, it argues that the role of political actors like parties and organized interests in tax policymaking has to be understood against the background of this institutional setup. The chapter concludes that the literatures on different models of capitalism and on the politics of taxation would benefit from greater cross-fertilization.