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housing rent, real estate tax, market value of residential real estate, municipal revenue, spatial interaction model, internal migration One of the main factors affecting changes in internal migration is real estate taxation. In this paper, we analyse the impact of real estate taxation on internal migration flows of human resources between spatial units at the local level. We address the impact of changed taxation policy on the attractiveness and stickiness of Slovenian municipalities on the dynamics of migration for internal migration flows according to the annulled Real Property Tax Act. To this end, a spatial interaction model for internal migration flows was developed. In addition to the tax rate, which influences municipal revenues and the price of real estate through housing rents, we included other significant explanatory variables in our model. These include population size, distance, employment, gross personal income, municipal revenues, residential area per capita and the average price per square metre of floor space. On the basis of available data and including tax rate as a decision variable in the spatial interaction model, the impact of taxation policy on the attractiveness of municipalities of destination for migration is analysed in more detail in the case study for the Municipality of Ljubljana. Based on available data, we also analysed the changes in municipal revenue brought on by the changes in taxation of real estate in all municipalities in Slovenia for migration flows.

Impact of the real estate taxation and municipal revenue on dynamics of internal migration: Case study for City Municipal of Ljubljana