The impact of taxes and social spending on inequality and poverty in Argentina, Bolivia, Brazil, Mexico and Peru: a synthesis of results
Gray Molina, George
We apply a standard tax and benefit incidence analysis to estimate the impact on inequality and poverty of direct taxes, indirect taxes and subsidies, and social spending (cash and food transfers and in-kind transfers in education and health). The extent of inequality reduction induced by direct taxes and transfers is rather small (2 percentage points on average) especially when compared with that found in Western Europe (15 percentage points on average). What prevents Argentina, Bolivia and Brazil from achieving similar reductions in inequality is not the lack of revenues but the fact that they spend less on cash transfers -especially transfers that are progressive in absolute terms- as a share of GDP. Indirect taxes result in that net contributors to the fiscal system start at the fourth, third and even second decile on average, depending on the country. When inkind transfers in education and health are added, however, the bottom six deciles are net recipients. The impact of transfers on inequality and poverty reduction could be higher if spending on direct cash tranfers that are progressive in absolute terms is increased, leakages to the nonpoor are reduced and coverage of the extreme poor by direct transfer programs is expanded.
Puede citar el documento con el texto siguiente:
Item perteneciente a la Colección
Items similares por titulo, autores y/o materias.
Alzúa, María Laura; Amendolaggine, Julián; Cruces, Guillermo; Greppi, Catrihel (CAF; Buenos Aires, 2016-10)We study the impact of a social housing policy program implemented in Argentina, exploiting the random assignment rule to identify the policy's causal effect on labor market and other socio-economic outcomes. In particular, ...
CAF (CAF; Caracas, 2006)In 2005, Latin America once again exhibited a positive macroeconomic performance, partially as a result of favorable international conditions and the resumption of foreign capital flows. These conditions provided an ...
Duque, Valentina; Rosales-Rueda, María; Sánchez, Fabio (CAF; Colombia, 2016-10-04)This study investigates how early-life conditions interact with subsequent human capital investments to influence future educational outcomes. To provide causal evidence, we exploit two sources of exogenous variation: i) ...