The Distributional Impact of Fiscal Policy in Honduras

By David Locke Newhouse, Irene Yackovlev, Robert Gillingham

July 1, 2008

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David Locke Newhouse, Irene Yackovlev, and Robert Gillingham. The Distributional Impact of Fiscal Policy in Honduras, (USA: International Monetary Fund, 2008) accessed November 12, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper uses household survey data to estimate the incidence of tax and spending programs in Honduras. Any such exercise is fraught with difficulty, so our simplifying assumptions are carefully explained. Rather than look at tax and spending completely independently, we evaluate net incidence of major programs-such as health care and pensions-to get a more holistic evaluation of redistribution. Our results show that fiscal policy is, on balance, progressive, but that there is room for significant improvement. In particular, energy subsidies, university education and public pension programs provide disproportionate benefits to higher-income households.

Subject: Consumption, Corporate income tax, Fiscal policy, Income, Personal income

Keywords: Consumer spending, Income tax, VAT, WP

Publication Details

Pages:

20
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2008/168
Stock No:

WPIEA2008168
ISBN:

9781451870268
ISSN:

1018-5941

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