Tax-Benefit Design and Family Composition: Trading Off Efficiency and Equity

The TAXFAM project investigates how the Belgian tax-benefit system interacts with household composition throughout the family life cycle, from couple formation and childrearing to household dissolution through separation and divorce. The project aims to identify and quantify the trade-offs between redistribution and economic efficiency embedded in tax-benefit design. By combining expertise in microsimulation modelling, econometrics, and public economics, TAXFAM provides a comprehensive perspective on the interplay between family dynamics and fiscal policy.

An ARC project (action de recherche concertée) supported by the Fédération Wallonie-Bruxelles, 2023-2028.

The project leverages an exceptionally rich administrative dataset covering the entire Belgian population together with BEAMM (Belgian Arithmetic Microsimulation Model), a highly detailed tax-benefit microsimulation model. This unique combination enables the analysis of policy-relevant questions at an unprecedented level of detail and allows the evaluation of alternative tax-benefit reforms in a consistent framework.

The research is structured around three main themes.

(1) The fiscal unit: individual or couple?

A central question is whether adults should be taxed individually or jointly and, if jointly, how such taxation should be designed. Using detailed household expenditure data, we will estimate economies of scale in consumption arising from shared expenditures such as housing and energy. This will make it possible to compare the income levels required for households of different compositions to attain equivalent living standards. In addition, a structural labour supply model will be used to simulate the effects of moving from joint to individual taxation.

(2) Child-related policies and labour market participation

The project examines the redistributive effects of child-related policies and their impact on parental labour supply. We will estimate a structural labour supply model and use it to evaluate reforms that increase the generosity of childcare subsidies, thereby assessing both distributional and employment effects.

(3) Household dissolution: divorce and alimony

The project analyses the fiscal treatment of alimony payments and co-parenting arrangements in Belgium. This will allow us to identify the key determinants of an efficient and equitable tax treatment of alimony and to evaluate alternative policy designs, including the role of income-dependent tax deductions or credits.

Beyond its scientific contributions, TAXFAM has a strong dissemination component. The policy evaluation tools developed within the project will be made publicly available through the open-access BEAMM platform, providing policymakers, civil society organisations, and citizens with transparent tools to assess the effects of tax-benefit reforms.

Koen Declercq (PI) is an associate professor at the Center for Applied Public Economics (CAPE) at UCLouvain - Saint-Louis Bruxelles. He obtained his PhD in economics from KU Leuven in 2016. His research focusses on empirical microeconomics with a particular focus on the evaluation of labor market policies using state of the art econometric methods. Koen also has extensive expertise in the development and estimation of structural behavioral discrete choice models, particularly in the areas of labor markets and higher education. He has additionally contributed to the empirical evaluation of policy interventions through the implementation and analysis of randomized controlled trials in financial education. His research is published in leading academic journals including Journal of Applied Econometrics, Labour Economics and Economics of Education Review. He serves as a member of the Belgian National Productivity Board and as co-chair of the Scientific Committee of The Social Study, a nationally representative panel comprising approximately 5000 respondents.

Alexandre Jacquemain is a postdoctoral researcher at the Center for Applied Public Economics (CAPE) at UCLouvain – Saint-Louis Bruxelles. He holds master’s degrees in economics and in statistics and obtained his PhD in statistics from UCLouvain in 2023 with a thesis on Lorenz regressions, a statistical method to quantify how much of income inequality can be explained by observed characteristics. This work is published in journals such as the Journal of Statistical Software, the Electronic Journal of Statistics and Computational Statistics & Data Analysis, and is implemented in the R package LorenzRegression. At CAPE, Alexandre leads the design and development of the tax-benefit calculator of BEAMM, with a particular focus on modelling the Belgian personal income tax. Since this tax treats couples and children through specific provisions, such as the marital quotient, child-related tax allowances and the deductibility of alimony, the calculator provides the simulation backbone for the reforms studied in TAXFAM. His current research examines how marriage and assortative mating shape economic inequality, a project for which he received a (LIS)²ER research stay grant at the LIS Data Center and LISER in Luxembourg in 2026.

Tom Truyts (PI, spokesperson) is professor of public economics at UCLouvain - Saint-Louis Bruxelles and the coordinating promoter of TAXFAM. He holds master’s degrees in history and in economics and a PhD in economics from KU Leuven. In 2019 he co-founded CAPE, which he directs, and he coordinates BEAMM, the Belgian Arithmetic Microsimulation Model: an open-access platform on which some 25 researchers combine administrative data covering the entire Belgian population with detailed simulations of taxes, social contributions and benefits, and with behavioural models of labour supply and intra-household decisions. TAXFAM builds on this infrastructure to study how the tax-benefit system treats families, and how families respond to it.

Tom Van Zeebroeck is a doctoral researcher at CAPE, UCLouvain – Saint-Louis Bruxelles. He holds a bachelor’s degree in economics from the Université Saint-Louis – Bruxelles and master’s degrees in economics (magna cum laude) and in statistics from UCLouvain, with options in econometrics and data science. His doctoral research addresses a question at the heart of TAXFAM’s first theme: how to compare the living standards of households of different composition. Using the Belgian Household Budget Survey, he estimates equivalence scales from unitary demand systems (QUAIDS) and indifference scales from collective household models, which account both for economies of scale in shared consumption and for the way resources are divided between partners and children. To this end, he has also developed estimation tools for systems of nonlinear demand equations in R.. His work feeds into the welfare analysis of reforms in BEAMM, such as the identification of winners and losers of a reform of the marital quotient, a provision that mostly benefits couples with unequal earnings, where the intra-household distribution of resources matters most, and how children are treated fiscally in the Belgian personal income tax.

CAPE was founded in 2019 as a research center dedicated to advancing and promoting applied research in the fields of public policy evaluation and public finance at UCLouvain – Saint-Louis Bruxelles. CAPE currently hosts about 30 researchers, and functions as a highly integrated multidisciplinary research team. Many individual researchers’ research projects are all part of a global project and mutually compatible. Research at CAPE centers around the Belgian Arithmetic Microsimulation Model (BEAMM), a large-scale, open-access tax benefit model for Brussels and Belgium. Given its capacity to simulate behavioral and fiscal impacts with high precision, Beamm will constitute a crucial input for the research in this ARC project.

Annual Conferences

BEAMM.CONF26

June 2026, Brussels

Involving: Tom Truyts

2nd international BEAMM conference on public finance and public policy evaluation bringing together around 150 national and international researchers and practitioners working on public finance, policy evaluation and evidence-based policy making with keynote presentations by national and interational speakers on pressing Belgian and international issues in fiscal and social policy and poster presentations by doctoral researchers. Each Beamm conference also hosts a block devoted to family economics.

BEAMM.CONF25

May 2025, Brussels

Involving: Tom Truyts

1st international BEAMM conference on public finance and public policy evaluation gathering around 150 national and international researchers, policy makers, and civil society with keynote presentations by national and international speakers on pressing Belgian and international issues in fiscal and social policy and poster presentations by doctoral researchers. The conference aims to stimulate dialogue, exchange good practices, and boost collaboration between academia, policymakers, and civil society. Each Beamm conference also hosts a block devoted to family economics.

Seminars

CAPE Economics Seminar Series

Involving: Tom Truyts & Koen Declercq

Weekly seminar series at CAPE where national and international researchers present their work on public economics, labor economics and environmental and transportation economics. Seminars on the topic of this ARC project:

Daniel Weishaar (University of Cologne) – November 2026: Self-financing tax cuts around the world
Tom Potoms (University of Antwerp) – October 2026: The price of long hours
Robert Dur (Erasmus University Rotterdam) – June 2026: Tax misperceptions and labor supply: A two-wave survey experiment in the Netherlands
Thomas Demuynck (ULB) – June 2026: Non-parametric test of single-crossing indifference curves
Denis Beninger (Federal Planning Bureau) – May 2026: LASER, a labour supply model to evaluate policy reforms in Belgium: presentation and results
Fabio Blasutto (ULB) - April 2026: Income pooling and within household risk-sharing: Evidence from data on individual expenditures
Thérèse Bastin (ULB) - April 2026: When wealth taxes don’t bite: Behavioral responses to the Belgian financial wealth tax
Laurens Cherchye (KU Leuven) - March 2026: Children, marriage markets, and poverty: Intrahousehold allocations and individual welfare
Tom Potoms (University of Antwerp) – January 2026: Public insurance and marital outcomes: Evidence from the affordable care act’s Medicaid expansions
Frederic Vermeulen (KU Leuven) – November 2025: Spouses with benefits: on match quality and consumption inside households
Matteo Richiardin (University of Essex) – October 2025: Dynamic analysis of the effects of taxes and benefits over the life course: The SimPaths open-source framework and applications to the UK and selected EU countries
Bart Capéau (ULB) – June 2025: The impact of preference heterogeneity, household economies of scale, and untaxable goods on the structure of optimal indirect taxes
Pierre Boyer (CREST, Paris) – May 2025: Taxation of couples
Sam Cosaert (University of Antwerp) – March 2025: Quantifying welfare costs of peer influence and income misperception: A revealed preference approach
Erwin Ooghe (KU Leuven) – February 2025: Fairness gaps for earnings tax design
Bram De Rock (KU Leuven) – January 2025: A spouse and a house are all we need? Housing demand, labor supply and divorce over the lifecycle
Edoardo Ciscato (KU Leuven) – November 2024: Wealth and the marriage market
Kevin Spiritus (Erasmus University Rotterdam) – October 2024: Using coordinate transformations to derive optimal multidimensional tax rates
Guillaume Perilleux (UMons) – November 2023: Time and money spent on children: Effect of the (grand)parents’ education and substitution within time allocations

Kick Off Event

October 2023, Brussels

Involving: Tom Truyts & Koen Declercq

TAXFAM workshop with 2 keynotes:

Alexandre Jacquemain (CAPE): Lorenz regressions: a statistitcal method to quantify explained inequality
Tom Potoms (University of Sussex): A house and a spouse are all we need? Housing demand, labor supply and divorce over the lifecycle

Declercq, Koen, Muriel Dejemeppe, and Mathilde Pourtois. “The Impact of Tightened Unemployment Benefit Eligibility on Young Adults’ Housing and Use of Private Safety Nets.” LIDAM Discussion Paper, IRES/2026/05, 2026. https://hdl.handle.net/2078.5/272981.

Jacquemain, Alexandre, and Cédric Heuchenne. “LorenzRegression: An Implementation of the Lorenz and Penalized Lorenz Regressions in R.” Journal of Statistical Software 117, no. 6 (2026): 1-33. https://doi.org/10.18637/jss.v117.i06.

Acronym of the project: TAXFAM
Title of the project: Tax-Benefit Design and Family Composition: Trading Off Efficiency and Equity
Internal reference number: 23/28-001
Start date: 15/09/2023
End date: 14/09/2028
Principal investigators: Tom Truyts (spokesperson) and Koen Declercq

What is an ARC Project?

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