Subject The article considers international experience in income taxation. Objectives The study aims to review personal income taxation in Austria, Germany and Luxembourg, provide economic justification of the proposed scale of personal income tax assessment, and review the role of personal income tax in the formation of regional budgets revenues in the context of continuing risks of imbalance. Methods The study rests on general (analysis, comparison, measurement) and special (economic-mathematical and statistical) scientific methods. Results I developed a progressive scale of personal income taxation that is based not only on the fiscal function, but also on achieving the principle of social justice. Thus, individuals with wages of up to 10,600 RUB per month should be exempt from tax; up to 17,000–25,000 RUB – pay tax at reduced rates of 5% and 10%; over 25,000 RUB – at the current tax rate of 13%; and for high incomes I recommend using tax rates of 15%–19%. Conclusions and Relevance The findings may be used to take specific decisions on social and economic processes modernization by public authorities, and be included in the educational process of higher and secondary specialized educational institutions.
Keywords: personal income tax, social justice, tax policy, progressive taxation, tax revenues
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