Taxation : Regional bias in federal tax subsidy rates for giving? by C.T. Clotfelter and D. Feenberg

Abstract


 
 
 This study examines regional variation in average subsidy rates for charitable donations. The subsidy rate for an individual depends on the taxpayer’s itemization status and marginal tax rate, and this subsidy rate rises with income. One would expect that average subsidy rates would be higher in wealthier regions. What is not clear is whether subsidy rates vary systematically independent of income. In order to examine these questions, the authors decompose subsidy rates independent of income, in what appears to be an unintended regional bias in the federal policy toward charitable giving. Public Finance, Vol. 45, No. 2 (1990), pp. 228-240. (Reprinted with permission of Public Finance.)