Abstract
This case study considers two frequently advocated approaches to reducing indirect taxation in Brazil: reduction in taxes on food; reduction in taxes on intermediate inputs to agriculture. To asses the effects of both on income distribution poverty levels, a bottom-up general equilibrium model of Brazil (TERM-BR) is linked to a microsimulation model. It is shown that one of the favoured policies is more poverty reducing, the other more income inequality reducing. Perhaps even more importantly, the analysis demonstrates that the two policies lead to very different outcomes in terms of inter-state transfers; a major political barrier to reform in a federal state.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
