Assessing the Effects of Fiscal Policies on Poverty and Inequality : The Case of Uruguay
This study looks at the redistributive effects of fiscal policy -- in particular of direct taxation and expenditures -- in Uruguay. This fiscal incidence analysis applies a widely recognized methodology to household survey data and government data...
| Main Authors: | , , |
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| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2020
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/998831608039660526/Assessing-the-Effects-of-Fiscal-Policies-on-Poverty-and-Inequality-The-Case-of-Uruguay http://hdl.handle.net/10986/34943 |
| Summary: | This study looks at the redistributive
effects of fiscal policy -- in particular of direct taxation
and expenditures -- in Uruguay. This fiscal incidence
analysis applies a widely recognized methodology to
household survey data and government data for fiscal year
2017 and compares the results with the policies seen in 2009
to study the evolution of the distributional impacts of
fiscal policy in the country. The study finds evidence that
Uruguayan fiscal policy continues to reduce inequality, with
government expenditures in the form of in-kind transfers
leading to the largest decreases. While expenditures in
basic education are benefitting the poorest, expenditures in
tertiary education remain largely regressive. The personal
income tax is found to be largely progressive, with the top
quintile paying more than four-fifths of this tax. Uruguay’s
fiscal policies also lead to a reduction in poverty, mainly
due to well-targeted direct transfers. |
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