IRPEF – the Italian personal income tax – is the leading tax in terms of share of total government revenue in Italy. After a decade of reforms, the tax-benefit structure still exhibits several critical issues that need to be addressed. The paper presents a tax-benefit design proposal for...

The paper illustrates three different methods of achieving progressivity of the income tax. The first one is the traditional brackets system, with increasing tax rates in each bracket. The second one is the fixed tax allowance coupled with a flat rate. The third one is the method that the...