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Tributarios TAXES AND INCOME DISTRIBUTION
IN CHILE: SOME UNPLEASANT REDISTRIBUTIVE ARITHMETIC. This paper quantifies the direct impact of taxes on income distribution at the household level in Chile and estimates the distributional effect of several changes in the tax structure. We find that income distributions before and after taxes are very similar (Gini coefficients of 0.4889 and 0.4920, respectively). Moreover, radical modifications of the structure, such as raising the value added tax from 18 to 25% or substituting a 20% flat tax for the present progressive income tax (top marginal rate of 48% for monthly incomes over $6,000) affect the after-tax distribution only slightly. Our results suggest that to reduce income inequality, the focus of discussion should be on the amount to be redistributed, the targeting of public spending, and the relative efficiency of alternative taxes, and not on the progressivity of the tax system. Documento completo en formato PDF Pdf (338Kb) Si Ud. no tiene un visualizador de formato PDF, |