Redistributive effects of alternative indirect tax reforms for Brazil

This paper investigates the extent to which redistributive goals can be reached in Brazil through the indirecttax system. The equivalent variation measure of consumer surplus is used to estimate the gains and losses of different household groups resulting from alternative tax reforms. The overall effect of each reform is evaluated on the basis of a Bergson-Samuelson social welfare function. The results suggest that substantial changes in the existing rate structure - particularly the introduction offood subsidies - would be required in order to secure significant welfare improvements for low income classes

Simulating Brazils tax-benefit system using Brahms, the Brazilian household microsimulation model

Despite raising an amount of taxes that represents nearly 37% of the countrys GDP and spending over half of this revenue on social programmes, the Brazilian government has not been able to significantly alleviate inequality and poverty. A number of studies have shown evidence that, to a great extent, this situation is due to the inadequate targeting of public expenditures. The distributive impact of the financing of these expenditures, however, has received less attention. This paper investigates the combined impact of taxes and government cash transfers on the distribution of income among Brazilian households and compares Brazils redistributive performance with that of some countries with a similar tax burden.Apesar de arrecadar um montante de tributos equivalente a cerca de 37% do PIB e gastar mais da metade desta receita em programas sociais, o governo brasileiro não tem sido capaz de aliviar significativamente o problema da desigualdade e da pobreza. Alguns estudos têm mostrado evidência de que esta situação é, em grande parte, devida à inadequada focalização dos gastos públicos. Entretanto, o impacto distributivo do financiamento desses gastos tem recebido menos atenção. O presente trabalho investiga o impacto conjunto dos tributos e transferências monetárias governamentais sobre a distribuição de renda entre os domicílios brasileiros e compara o Brasil com alguns outros países com carga tributária semelhante

O custo marginal social da tributação indireta no Brasil: identificando direções de reforma

This paper applies the method developed by Ahmad & Stern (1984) to calculate the marginal welfare cost of taxation for 27 commodity groups using microdata from the POF 2002-2003 and price-elasticities of demand based on the Almost Ideal Demand System (AIDS). The estimates are presented for different assumptions about the society's degree of inequality aversion. The results suggest that some commodity groups are strong candidates to lower (and other groups, to higher) taxation both for distributional and efficiency reasons. However, in general, there is a strong conflict between equity and efficiency considerations in reforming the Brazilian indirect tax system.Este artigo aplica o método desenvolvido por Ahmad & Stern (1984) para calcular o custo marginal social da tributação para 27 grupos de bens, usando microdados da POF 2002-2003 e elasticidades-preço da demanda baseadas no Sistema Quase Ideal de Demanda (AIDS). As estimativas são apresentadas para diferentes hipóteses sobre o grau de aversão da sociedade à desigualdade. Os resultados indicam que alguns bens são fortes candidatos à redução de tributação (e outros, ao aumento de tributação) tanto por considerações distributivas quanto de eficiência. Porém, de forma geral, há um forte conflito entre os objetivos de equidade e de eficiência na reforma da tributação indireta no Brasil

Redistributive indirect taxes for Brazil: An application of the theory of optimal taxation

The thesis seeks to analyse the optimal design of indirect taxes for Brazil. The analysis is intended to shed some light on the question of how and to what extent redistributive goals can be achieved through the indirect tax system. A computable model is specified in which households choose consumption goods to maximise their utilities and the government chooses, for the urban and the rural sector separately, a set of commodity taxes and a (uniform) poll subsidy to households so as to maximise a Bergson-Samuelson social welfare function subject to its budget constraint and the restrictions on its ability to tax. It is assumed that producer prices are fixed and there are no profits. The model is solved under alternative assumptions about the extent of the government's concern with inequality, the constraints it may face on taxation possibilities, its revenue requirements and the preferences of households. The impacts of the optimal taxes on the welfare of households and on the overall level of social welfare are measured and compared with the effects of alternative partial—i.e., non-optimising—tax reform proposals. The results suggest that the potential redistributive power of indirect taxation in Brazil is quite strong though substantial changes in the existing rate structure would be required in order to secure significant improvements in social welfare

Notas para Formulação de uma Proposta de Reforma Tributária para o Brasil

Essas notas foram preparadas originalmente como um dos documentos de apoio às discussões que resultaram na elaboração do estudo A Agenda Perdida, o qual pode ser acessado no seguinte endereço: http://www.iets.inf.br/policy-papers/set2002.htm

A UNIVERSAL BASIC INCOME FOR BRAZIL: FISCAL AND DISTRIBUTIONAL EFFECTS OF ALTERNATIVE SCHEMES

ABSTRACT The Covid-19 pandemic outbreak has led to an increasing interest in universal basic income (UBI) proposals, as it exposed the inadequacy of traditional welfare systems to provide basic financial security to a large share of the population. In this paper, we use a static tax-benefit microsimulation model to analyse the fiscal and distributional effects of the hypothetical implementation in Brazil of alternative UBI schemes that partially replace the existing tax-transfer system. The results indicate that introducing a UBI/Flat Tax system in the country could be both extremely effective in reducing poverty and inequality and economically viable