Study: Tax reforms would curb income inequality

WASHINGTON — The Organization for Economic Cooperation and Development on Wednesday recommended a series of tax changes to limit the worldwide rise in income inequality.

The Paris-based OECD, which includes the United States among its 34 members, advised taxing various forms of investment gains as ordinary income. Many forms of investment returns are now taxed at lower rates than ordinary income and disproportionately benefit the richest 1 percent.

The OECD also suggested abolishing tax deductions that primarily favor the wealthy, reviewing inheritance taxes and improving transparency and international cooperation on taxes.

The share of pre-tax income going to the richest 1 percent has increased in several developed countries since 1981, including the United States, the United Kingdom, Australia, Japan and Norway.

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