Discussion paper
DP18414 Taxes and Migration Flows: Preferential Tax Schemes for High-Skill Immigrants
We study preferential tax schemes for high-skill immigrants such as those adopted in Europe in the past two decades. The overall assessment is negative. While they induce a very large immigration surplus tilted towards the low-skill, they may also give rise to an emigration deficit that more than offsets the surplus. The unilateral adoption is ambiguous in its welfare effects for both high- and low- skill workers, but the multilateral adoption is unambiguous in redistributing from low-skill to high-skill workers.
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