What Are the Economic and Labour Market Effects of an Income Tax Reduction Targeted at Older Workers?

Table 5

Impact of a 10% temporary reduction in earned income taxes for workers aged 60 and over on key macroeconomic indicators (percentage point difference relative to reference scenario).

	2010	2014	2022	2030	2042	2050
Real GDP per capita	0.08	0.08	0.12	0.20	0.10	0.07
Labour supply/capita	0.12	0.14	0.16	0.24	0.07	0.05
National savings	−0.19	0.17	0.19	0.21	0.03	0.15
Capital stock/capita	−0.03	−0.07	0.01	0.08	0.17	0.16
Capital/labour ratio	−0.16	−0.24	−0.19	−0.21	0.09	0.11
Real wages	−0.05	−0.07	−0.05	−0.06	0.02	0.03
Earned income tax rate	−0.13	−0.14	−0.14	−0.15	−0.02	−0.01