Tax administration resources and Income inequality

The paper contributes to the research field as the first quantitative study deploying OECD Tax administration database to provide empirical evidence with respect to the impact of Tax administration resources on income inequality. Methodologically speaking, we apply, for the unique data set of 46 countries extracted from OECD Tax administration 2015 database, the cross-sectional multiple regression employing the OLS estimator before justifying with other estimators i.e. truncated regression, quantile regression and weighted least squared (WLS). We finally obtain the robustly negative relationship between Tax administration resources (employees and non-salary expenditure) and income inequality as hypothesize. The paper ends with some policy recommendations following the limitations and directions for further research.