So, if the flat tax rate was 10, those who made 100,000. We conclude that the flat tax led to increased income inequality and it stimulated households consumption particularly among the wealthiest households. A flat tax rate simply means that everyone pays the same tax rate regardless of their tax bracket. The results also indicate that the income elasticity of consumption is decreasing across quartiles, from 81 to 71 percent. The Lorenz curve is illustrative, as only the last quantile of the population (richest 20%) appears as the clear winner of the flat tax. Our involvement began with an article we. The inequality indicators we calculated (the Gini index, the relative mean deviation, the coeficient of variation, the standard deviation of logarithms, the Mehran index and the Piesch index) show an increase in inequality determined by the flat tax. BIPARTISAN SUPPORT FOR THE FLAT TAX Almost from its modern inception, the flat tax enjoyed bipartisan support. We found that the higher the gross wage, the higher the flat tax gains. We compared 2005 against 2004, when we were able to isolate the flat tax impact from other factors.
In this paper we focused on the flat tax impact on inequality in Romania.
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