This paper addresses two fundamental issues in indirect tax design. It first revisits the case for reduced rates on items especially important to the poor, establishing conditions under which even very crudely targeted spending measures better serve their interests. It then explores the welfare costs from cascading taxes, showing that these may actually be lower the wider the set of inputs that...

This paper presents an experimental investigation of the individual willingness to pay (WTP) for green electricity. The experimental design comprises a public-choice scenario and a individual-choice scenario. It involves three different payment vehicles for the public promotion of renewables: direct tax, indirect tax, and CO2 tax. We test for the extent of freeriding, the impact of different pa...

A comprehensive tax and benefit incidence analysis is presented covering the redistributive fiscal instruments implemented in Mexico in 2008 and 2010, representative of the urban and rural sectors, as well as nationally. The expansion of basic social programs and effectively targeted direct monetary transfers have increased the progressivity of Mexico ́s fiscal system in recent years, but redist...

This paper proposes a methodology for testing for whether tax reforms are pro-poor. This is done by extending stochastic dominance techniques to identify tax reforms that will be deemed absolutely or relatively pro-poor by a wide spectrum of poverty analysts. The statistical properties of the various estimators are also derived in order to make the method implementable using survey data. The me...

Annual growth rates of real GDP in New Zealand have varied widely, from 18% to −8%, since World War II. During this period the tax burden (the ratio of tax revenue to GDP) has trended upward from 23% to 35%. The tax mix (the ratio of indirect taxes to direct taxes) has varied between 0.31 and 0.75, having increased recently with the introduction of the goods and services tax. In this paper we e...