Family and Personal Income Tax in Europe: how the fiscal framework takes account of marriage and children

This paper compares the treatment of families in thirteen European income tax systems: twelve countries from the European Union and Poland. For the sake of simplicity families with only one wage earner are considered. In the first section, we survey the main features of twelve European tax systems to take account of dependent spouse and children. In the second section, we compare the tax-exempt income brackets for each country. In the third section, we calculate the costs that each tax system associates with the presence of dependent spouse and children in the taxpayer\u2019s family. These costs may be explicitly stated as fiscal arrangements and child benefits or implicitly derived as a function of tax credits, family quotients and tax schedules. In the fourth section, the tax systems of Italy, Ireland, Belgium, Germany, France, Portugal and Poland are simulated on a representative population derived from the total number of employees in Italy. The simulation allows to evaluate the total tax yield and the impact of the different fiscal frameworks on three family types: single households, married couples with dependent children, singles with dependent children