arXiv 3 Apr 2026 · Econometrics
arXiv:2604.03025 · PDF · DOI · OpenAlex · Extracted main text
We analyse the UK income distribution from 2000 to 2023 using HMRC annual percentile data for both pre-tax and post-tax income. We fit a prefactor-adjusted $κ$-generalised specification to the data by weighted non-linear least squares and use inverse transform sampling to generate simulated income populations. The results suggest a redistribution of income shares over the period: the bottom 40% appears to have increased its share, the middle-upper part of the distribution (50th--90th percentiles) lost share, the top 10% remained broadly stable, and the top 1% increased its share of pre-tax income. Because the modified specification is defined only above a positive threshold, conclusions concerning the lower tail should be interpreted with some caution. Using simulated 2023 pre-tax incomes to examine tax reform scenarios, we find that revenue-equivalent tax increases on high-income earners must be more than four times as large as comparable increases on lower-income earners. This suggests that, despite increased concentration at the top, the UK tax base remains driven primarily by the large number of taxpayers outside the very top of the distribution.
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The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.
| Reference | Intensity | Mentions | Sections | Main text | |
|---|---|---|---|---|---|
| 1 | Clementi, Fabio and Gallegati, Mauro (2016) The Distribution of Income and Wealth | 0.874 | 7 | 2 | 100% |
| 2 | Clementi, Fabio (2023) The Kaniadakis distribution for the analysis of income and wealth data | 0.874 | 7 | 2 | 100% |
| 3 | Advani, Arun and Summers, Andy and Tarrant, Hannah (2023) Measuring top income shares in the UK | 0.874 | 5 | 2 | 100% |
| 4 | Diamond, Peter A. and Saez, Emmanuel (2011) The Case for a Progressive Tax: From Basic Research to Policy Recommendations | 0.405 | 1 | 1 | 100% |
| 5 | Atkinson, Anthony B and Jenkins, Stephen P (2020) A different perspective on the evolution of UK income inequality | 0.405 | 1 | 1 | 100% |
| 6 | Cowell, Frank A (2011) Measuring Inequality | 0.405 | 1 | 1 | 100% |
| 7 | Dr agulescu, Adrian and Yakovenko, Victor M (2001) Exponential and power-law probability distributions of wealth and income in the United Kingdom and the United States | 0.405 | 1 | 1 | 100% |
| 8 | Forbes, Samuel (2022) Data driven analysis and modelling of the wealth distribution self | 0.405 | 1 | 1 | 100% |
| 9 | HM Revenue & Customs (2025) Table 3.1a Percentile points from 1 to 99 for total income before and after tax | 0.405 | 1 | 1 | 100% |
| 10 | (2025) Direct effects of illustrative tax changes: Income tax rates | 0.405 | 1 | 1 | 100% |
Showing the top 10 of 14 scored citations.