IDEAS home Printed from https://ideas.repec.org/a/ibf/riafin/v12y2019i1p79-98.html
   My bibliography  Save this article

Progressive Reform Of Value Added Tax: An Investigation On Poverty And Inequality In Ecuador Reforma Impositiva Progresiva Al Iva: Analizando La Pobreza Y Desigualdad En El Ecuador

Author

Listed:
  • Marcelo Varela
  • Jose Antonio Sanchez
  • Nicole Cerda Monge

Abstract

The purpose of this study is to evaluate the effects of a progressive reform of the Value Added Tax (VAT) as a mechanism for redistributing income and expenses in Ecuador. We also determine which products should reduce the percentage, which products should increase. We do this in accordance with a progressiveness of 8%, 14% and 18%. The current Value Added Tax equals 0% and 12% at present. Our analysis makes use of ECUAMOD, the microsimulation model of fiscal benefits for Ecuador, together with household microdata representative of the household survey called ENIGHUR 2011-2012. These scenarios have been constructed considering the VAT on these products is higher in other countries. Our simulations show that three scenarios increase fiscal revenues. They can be used for an increase in Monetary Transfers, as well as allowing reducing the fiscal deficit. This can be done without affecting inequality

Suggested Citation

  • Marcelo Varela & Jose Antonio Sanchez & Nicole Cerda Monge, 2019. "Progressive Reform Of Value Added Tax: An Investigation On Poverty And Inequality In Ecuador Reforma Impositiva Progresiva Al Iva: Analizando La Pobreza Y Desigualdad En El Ecuador," Revista Internacional Administracion & Finanzas, The Institute for Business and Finance Research, vol. 12(1), pages 79-98.
    • Handle: RePEc:ibf:riafin:v:12:y:2019:i:1:p:79-98
    as

    Download full text from publisher

    File URL: http://www.theibfr2.com/RePEc/ibf/riafin/riaf-v12n1-2019/RIAF-V12N1-2019-6.pdf
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    Value Added Tax; Poverty; Inequality; Income Distribution; Microsimulation;
    All these keywords.

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ibf:riafin:v:12:y:2019:i:1:p:79-98. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Mercedes Jalbert (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.