"Minouche Shafik, director of the London School of Economics, argues that we need to weave a new kind of safety net.
6. Restore progressivity in tax systems. There is clear evidence of a declining trend in tax progressivity in OECD countries, particularly in the 1980s and 1990s. Tax reforms have raised exemption thresholds and lowered top personal income tax rates, placing a greater tax burden on the middle class. Similarly, corporate tax rates have fallen on average across the OECD (from 32% on average in 2000 to 25% in 2015) while taxes on consumption have risen (the average standard rate of VAT increased from 18% in 2000 to 19.2% in 2015). This has had negative effects on social cohesion and social mobility. In more unequal countries, the ability of children to do better than their parents tends to be much reduced. Restoring progressivity in tax systems and enabling greater social mobility will do much to heal divisions in society."
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