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Long-term fiscal implications of subsidizing in-vitro fertilization in Sweden: A lifetime tax perspective

Svensson, Anders LU ; Connolly, Mark; Gallo, Federico and Hagglund, Leif (2008) In Scandinavian Journal of Public Health 36(8). p.841-849
Abstract
Aims: In Sweden approximately 3% of annual births are conceived using assisted reproductive technologies ( ART). In light of increasing use of ART in Sweden we estimate the lifetime future tax revenues of a child conceived by in-vitro fertilization ( IVF) to establish whether public subsidy of IVF represents sound fiscal policy. Methods: A modified generational accounting model was developed to calculate the net present value ( NPV) of average investment costs required to achieve an IVF-conceived child. The model simulates direct lifetime financial interactions between the child and the Swedish government. Within the model we assume average direct financial transfers are made to the individual ( eg, child allowance, education, health care,... (More)
Aims: In Sweden approximately 3% of annual births are conceived using assisted reproductive technologies ( ART). In light of increasing use of ART in Sweden we estimate the lifetime future tax revenues of a child conceived by in-vitro fertilization ( IVF) to establish whether public subsidy of IVF represents sound fiscal policy. Methods: A modified generational accounting model was developed to calculate the net present value ( NPV) of average investment costs required to achieve an IVF-conceived child. The model simulates direct lifetime financial interactions between the child and the Swedish government. Within the model we assume average direct financial transfers are made to the individual ( eg, child allowance, education, health care, pension, etc). In return, the individual transfers resources to the government through taxation based on anticipated average earnings. The difference between direct transfers and gross taxes paid equals the net-tax contribution. Individual tax contributions were held constant in the model. Results: Based on average life-expectancy an individual born in 2005 will pay an undiscounted 32.5 million SEK in taxes to the Swedish government and receive 20.9 million SEK in direct financial transfers over their lifetime. When these figures are discounted and IVF costs are included in the analysis we obtain a lifetime NPV of 254,000 SEK with a break-even point at age 41 ( the age of achieving a positive NPV) for an individual conceived through IVF. Conclusions: Based on results presented here we conclude that State-funded IVF in Sweden does not negatively impact the long run fiscal budget. Conversely, over an average lifetime an IVF offspring returns a positive net value to the State. (Less)
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author
organization
publishing date
type
Contribution to journal
publication status
published
subject
keywords
fertility, Demography, fiscal budget, in-vitro fertilisation, net, present value
in
Scandinavian Journal of Public Health
volume
36
issue
8
pages
841 - 849
publisher
Taylor & Francis
external identifiers
  • wos:000261827200009
  • scopus:56349118132
ISSN
1651-1905
DOI
10.1177/1403494808095086
language
English
LU publication?
yes
id
a4150fe6-e983-4b12-9793-e24f0febec36 (old id 1376353)
date added to LUP
2009-06-18 13:43:38
date last changed
2017-01-01 05:47:07
@article{a4150fe6-e983-4b12-9793-e24f0febec36,
  abstract     = {Aims: In Sweden approximately 3% of annual births are conceived using assisted reproductive technologies ( ART). In light of increasing use of ART in Sweden we estimate the lifetime future tax revenues of a child conceived by in-vitro fertilization ( IVF) to establish whether public subsidy of IVF represents sound fiscal policy. Methods: A modified generational accounting model was developed to calculate the net present value ( NPV) of average investment costs required to achieve an IVF-conceived child. The model simulates direct lifetime financial interactions between the child and the Swedish government. Within the model we assume average direct financial transfers are made to the individual ( eg, child allowance, education, health care, pension, etc). In return, the individual transfers resources to the government through taxation based on anticipated average earnings. The difference between direct transfers and gross taxes paid equals the net-tax contribution. Individual tax contributions were held constant in the model. Results: Based on average life-expectancy an individual born in 2005 will pay an undiscounted 32.5 million SEK in taxes to the Swedish government and receive 20.9 million SEK in direct financial transfers over their lifetime. When these figures are discounted and IVF costs are included in the analysis we obtain a lifetime NPV of 254,000 SEK with a break-even point at age 41 ( the age of achieving a positive NPV) for an individual conceived through IVF. Conclusions: Based on results presented here we conclude that State-funded IVF in Sweden does not negatively impact the long run fiscal budget. Conversely, over an average lifetime an IVF offspring returns a positive net value to the State.},
  author       = {Svensson, Anders and Connolly, Mark and Gallo, Federico and Hagglund, Leif},
  issn         = {1651-1905},
  keyword      = {fertility,Demography,fiscal budget,in-vitro fertilisation,net,present value},
  language     = {eng},
  number       = {8},
  pages        = {841--849},
  publisher    = {Taylor & Francis},
  series       = {Scandinavian Journal of Public Health},
  title        = {Long-term fiscal implications of subsidizing in-vitro fertilization in Sweden: A lifetime tax perspective},
  url          = {http://dx.doi.org/10.1177/1403494808095086},
  volume       = {36},
  year         = {2008},
}