Imposto de renda e distribuição de renda no Brasil

The Brazilian tax system places undue emphasis on indirect taxes - which comprise over 51% of its gross tax burden. The country's insistence on taxes on goods and services (indirect taxes) - to the detriment of taxes on income and property (direct taxes) - undermines the real application of the principle of contributive capacity, resulting in a regressive system whereby families with less income proportionally finance a larger share of the State. In the study, we analyze this disturbing national quirk in light of the evolution of the tax systems of certain central countries and draw comparisons with their current legislation. In addition to being normatively biased, Brazilian tax legislation has several technical limitations for the application of more efficient and equitable taxation on property and income. We undertake an exercise applying the Pareto interpolation method, using the 2008-2009 Household Budget Survey and the Large Numbers of Individual Income Tax Declarations (DIRPF), to estimate the level of inequality resulting from changes to personal income tax legislation. The key variable in the analysis is the reinstatement of taxation on profits and dividends, which are currently tax exempt. To that end, we have developed two simulations: one taxing profits and dividends at a 15% flat rate, and the other at a progressive rate varying between 15.0% and 27.5%. The results indicate a small improvement in income distribution, which is modest given the high level of income concentration in the country. On the other hand, there is a significant increase in revenue, between R$22 billion and R$ 39 billion, depending on the model for the taxation of profits and dividends. Finally, we performed a counterfactual exercise, whereby the additional revenue generated by the adoption of taxes on profits and dividends was used to fund an increase in public expenditure in several areas. The result was an improvement in income distribution

Human development and land tenure in Brazil

The perpetuation of profound socio-economic inequalities between the countryside and the city, inscribed in the differences between their respective quality of life indicators, allows us to state that rural and urban environments still have distinct social realities, despite territorial contiguity and the rising intercommunication between these spaces. This study proposes to investigate how living conditions and human development in the rural environment might be linked to a structural characteristic of the Brazilian countryside: the high concentration of land ownership. [...

Desonerações do imposto sobre produtos industrializados e seus impactos sobre o mercado de trabalho

Brazil federal tax policy changed course since 2007, when it was heavily activated to stimulate economic activity in a broad sense including job creation. A key policy instrument in this period was a tax on manufacturing products known as IPI (Imposto sobre produtos industrializados), whose tax rates decrease for a long list of products. Our main objective in this paper is to evaluate the impact of IPI reductions from 2007 to 2012 on labor market related outcomes, such as employment, hiring, separations and wages. We got null estimates for the impact in all labor market related variables for the whole period. Once we consider two subperiods, there appears impacts of reductions in IPI driving reductions in separations only for the 2010-2012 period. All these results are robust to alternative methodological procedures

Poverty profile: The rural North and Northeast of Brazil

Fortunately, both poverty and extreme poverty have shown a significant decrease in Brazil. According to data from the National Household Sample Survey (Pesquisa Nacional por Amostra de Domicílios - PNAD), poverty dropped over 20 per cent between 2004 and 2013, to about 9 per cent of the Brazillian population. Extreme poverty fell from about 7 per cent to 4 per cent over the same period. Much of this decline was due to the expansion of the labour market and the significant increase in transfers to poor households, through both social security and the Bolsa Família programme (Rocha 2013). [...

Public policies for rural development and combating poverty in rural areas

Brazil has become a good example of public policies aimed at combating poverty and fostering rural development, or, in other words, promoting family farming. The country has even 'exported' some of its policies, notably the Programa Bolsa Família and the Programa de Aquisição de Alimentos (PAA-Food Acquisition Programme). This paper aims to present an evaluation of this set of policies, starting with their recent performance in terms of resources and beneficiaries, going through an identification of coverage indicators, and, finally, recovering studies and analyses that assess these policies. Specifically, for the monitoring and evaluation of rural development policies, the main source of information for this work were the chapters on the subject in the Institute of Applied Economic Research (Ipea) Social Policy Bulletin. [...