Do Very High Tax Rates Induce Bunching? Implications for the Design of Income Contingent Loan Schemes*

Phi Chi Psi Omega Under the Higher Education Co not greater than >>>>>>>>not less than not less than not less than not less than not less than not less than not less than not less than not less than not less than not less than >+/-+/-not less than or equal to equal to or greater than equal to or greater than less than or similar to not equal to or greater than ntribution Scheme graduates face a sharp discontinuity in their taxable incomes. At the first repayment threshold, they are required to <>>theta eta zeta psi omega upsilon omicron omicron iota iota omega psi chi rho mu iota iota iota delta omicron omega omega psi psi psi chi chi sigma tau nu theta gamma gamma beta Alpha AE AE ?=backslash oe pay a percentage of their entire income to reduce their debts. This results in an extremely high eff Psi gamma delta delta delta iota theta theta theta gamma Psi ective marginal tax rate. Using a sample of taxpayer returns we inv zeta eta nu estigate whether taxpay Rho Mu Lambda Eta Xi ers equal to or greater than bunch gimel oe broken vertical bar broken vertical bar greater than or less than not less than or equal to >+/-equivalent to greater than or less than greater than or less than below the repayment threshold. We find a statistically beth beth gimel gimel gimel gimel gimel gimel gimel gimel gimel Chi Chi Psi Psi sign Chi Chi Psi Psi Psi Psi Psi Psi Psi Psi Omega Omega delta ificant degree of bunching below the threshold, but the effect is equal to or greater than beth beth beth gimel Phi Chi Chi Psi Psi Psi economi lambda lambda zeta alpha alpha Phi Pi Lambda Zeta Zeta Alpha Alpha Beta Gamma Alpha Beta Gamma Delta Epsilon Eta Zeta Theta Theta Iota Iota Xi Tau cally small. The result has important implications for the design of income parts per thousand gimel gimel boxed times ss contingent university loan schemes.equal to or greater than