Working paper

Taxing pensions

Helmuth Cremer, and Pierre Pestieau


There exists a wide variety of tax treatments of pensions across the world. And the reasons for such a range of regimes are not clear. This note reviews the general principles of pension taxes and analyses the theoretical foundations of why pension incomes ought to be taxed specifically. To do this, one has to distinguish between public and private pensions. The design of public pensions cannot be separated from the one of taxation. Regarding private pensions, the key issue is whether or not pension saving ought to be treated differently from other forms of saving.


private pensions; deferred tax; social security; retirement;

JEL codes

  • H21: Efficiency • Optimal Taxation
  • H55: Social Security and Public Pensions

Replaced by

Helmuth Cremer, and Pierre Pestieau, Taxing pensions: Theoretical considerations, in The Taxation of Pensions, R. Holzmann, and John Piggott (eds.), August 2018.


Helmuth Cremer, and Pierre Pestieau, Taxing pensions, TSE Working Paper, n. 16-629, March 2016.

See also

Published in

TSE Working Paper, n. 16-629, March 2016