Year: 2023
Type: preprint
Study design: Observational Study
Abstract: We study the impact of a policy change in the Netherlands that reduced preferential tax treatment duration for high-skilled migrants arriving from specific countries in certain years. Utilizing comprehensive tax and population data, we document substantial tax-induced emigration responses, primarily driven by the top 1% of earners. Highly mobile individuals within the top 5% also emigrate sooner, particularly to competing countries offering tax-breaks to attract skilled workers. Crucially, we uncover no change in mobility behavior among lower-earning workers. The increased tax receipts from lower-income individuals who remain offset the loss from fleeing high earners, making the policy fiscally cost-neutral.
Language: English
Topic: Migration and Labor Dynamics
Subfield: Sociology and Political Science
Field: Social Sciences
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W6996911799