The Czech tax sharing system essentially respects the basic principles described by contemporary theoretical approaches. The purpose of this paper is to examine how changes to its parameters influenced the municipal revenue distribution in relation to revenue equality and uniformity. We simulate different models of tax sharing with the full sample of Czech municipalities between 2010 and 2016. The impact of different parameterization is evaluated using the Gini coefficient. By comparing different scenarios, we conclude that the recent changes contribute to the equality of municipal tax revenue sharing per capita. Nevertheless, the conclusion should be interpreted in a broader context, e.g. concerning grants provided by the central government to municipalities.
Masaryk University, Faculty of Economics and Administration, Department of Public Economics, Lipová 41a, 602 00 Brno, Czech Republic
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