Mongolia : Distributional Impact of Taxes and Transfers

This paper uses Mongolia's Household Socio Economic Survey for 2016 to estimate the distributive impact of taxes and transfers. The findings show that the system is progressive and contributes to reductions in poverty and inequality. The Gini...

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Main Authors:	Freije, Samuel, Yang, Judy
Format:	Working Paper
Language:	English
Published:	World Bank, Washington, DC 2018
Subjects:	TAXATION INEQUALITY DISTRIBUTIONAL IMPACT TRANSFERS REDISTRIBUTION POVERTY MORTGAGE SUBSIDY CHILD MONEY PROGRAM SUBSIDIES
Online Access:	http://documents.worldbank.org/curated/en/628471541441796614/Mongolia-Distributional-Impact-of-Taxes-and-Transfers http://hdl.handle.net/10986/30845

id	okr-10986-30845
recordtype	oai_dc
spelling	okr-10986-308452021-06-08T14:42:48Z Mongolia : Distributional Impact of Taxes and Transfers Freije, Samuel Yang, Judy TAXATION INEQUALITY DISTRIBUTIONAL IMPACT TRANSFERS REDISTRIBUTION POVERTY MORTGAGE SUBSIDY CHILD MONEY PROGRAM SUBSIDIES This paper uses Mongolia's Household Socio Economic Survey for 2016 to estimate the distributive impact of taxes and transfers. The findings show that the system is progressive and contributes to reductions in poverty and inequality. The Gini coefficient of the pre-tax-and-transfer income is 0.4183 and decreases to 0.3507 after-tax-and-transfer. This is a reduction of 6.76 Gini points (around 16 percent). Something similar happens with the poverty rate, which decreases from 47.31 to 31.96 percent. Despite the progressiveness of the whole system, there are some caveats and policy warnings. First, pensions are the most redistributive instrument in the system, but their actuarial and fiscal sustainability is weak. Second, two programs (the child money program and the mortgage subsidy) do little redistribution -- the latter is actually regressive -- but represent a large share of the budget (around 2.5 percent of gross domestic product). These two factors, and the fact that up to a 35 percent of total expenditures in monetary and in-kind transfers is funded by corporate taxes and royalties -- which are highly dependent on volatile commodity prices—make the redistributive impact of the tax-and-transfer system susceptible to fiscal unsustainability. 2018-11-12T21:29:23Z 2018-11-12T21:29:23Z 2018-11 Working Paper http://documents.worldbank.org/curated/en/628471541441796614/Mongolia-Distributional-Impact-of-Taxes-and-Transfers http://hdl.handle.net/10986/30845 English Policy Research Working Paper;No. 8639 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper East Asia and Pacific Mongolia
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	TAXATION INEQUALITY DISTRIBUTIONAL IMPACT TRANSFERS REDISTRIBUTION POVERTY MORTGAGE SUBSIDY CHILD MONEY PROGRAM SUBSIDIES
spellingShingle	TAXATION INEQUALITY DISTRIBUTIONAL IMPACT TRANSFERS REDISTRIBUTION POVERTY MORTGAGE SUBSIDY CHILD MONEY PROGRAM SUBSIDIES Freije, Samuel Yang, Judy Mongolia : Distributional Impact of Taxes and Transfers
geographic_facet	East Asia and Pacific Mongolia
relation	Policy Research Working Paper;No. 8639
description	This paper uses Mongolia's Household Socio Economic Survey for 2016 to estimate the distributive impact of taxes and transfers. The findings show that the system is progressive and contributes to reductions in poverty and inequality. The Gini coefficient of the pre-tax-and-transfer income is 0.4183 and decreases to 0.3507 after-tax-and-transfer. This is a reduction of 6.76 Gini points (around 16 percent). Something similar happens with the poverty rate, which decreases from 47.31 to 31.96 percent. Despite the progressiveness of the whole system, there are some caveats and policy warnings. First, pensions are the most redistributive instrument in the system, but their actuarial and fiscal sustainability is weak. Second, two programs (the child money program and the mortgage subsidy) do little redistribution -- the latter is actually regressive -- but represent a large share of the budget (around 2.5 percent of gross domestic product). These two factors, and the fact that up to a 35 percent of total expenditures in monetary and in-kind transfers is funded by corporate taxes and royalties -- which are highly dependent on volatile commodity prices—make the redistributive impact of the tax-and-transfer system susceptible to fiscal unsustainability.
format	Working Paper
author	Freije, Samuel Yang, Judy
author_facet	Freije, Samuel Yang, Judy
author_sort	Freije, Samuel
title	Mongolia : Distributional Impact of Taxes and Transfers
title_short	Mongolia : Distributional Impact of Taxes and Transfers
title_full	Mongolia : Distributional Impact of Taxes and Transfers
title_fullStr	Mongolia : Distributional Impact of Taxes and Transfers
title_full_unstemmed	Mongolia : Distributional Impact of Taxes and Transfers
title_sort	mongolia : distributional impact of taxes and transfers
publisher	World Bank, Washington, DC
publishDate	2018
url	http://documents.worldbank.org/curated/en/628471541441796614/Mongolia-Distributional-Impact-of-Taxes-and-Transfers http://hdl.handle.net/10986/30845
_version_	1764473002386259968

Mongolia : Distributional Impact of Taxes and Transfers

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