Microsimulation analysis of the impact of indirect tax benefits on income distribution and poverty alleviation in Tanzania
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Date
2019
Journal Title
Journal ISSN
Volume Title
Publisher
United Nations University
Abstract
This paper analyses the impacts of indirect tax policy reforms on income distribution and poverty in Tanzania by applying a standard static microsimulation model TAZMOD v1.8. The simulations model two indirect tax reforms involving changes to the excise duty and value-added tax rates on alcoholic beverages and tobacco products, and changes to employers’ and employees’ contributions to the National Health Insurance Fund. The results of the first reform find a positive effect on government tax revenue and a neutral effect on income distribution and poverty. The results of the second reform find a positive effect on household income distribution and consumption. The findings show that, despite increasing unequal income distribution, poverty indicators fell.
Description
Full Text Report. Also available at: https://www.econstor.eu/handle/10419/211246
Keywords
Income distribution, Poverty, Tax-benefit reforms, Microsimulation, Indirect tax, Poverty alleviation, Indirect tax, Tax policy
Citation
Maskaeva, A., Bochkaeva, Z., Mmasa, J., Msafiri, M., & Iramba, E. (2019). Microsimulation analysis of the impact of indirect tax benefits on income distribution and poverty alleviation in Tanzania: An application of TAZMOD (No. 2019/16). WIDER Working Paper.