Taxation and Inequality in Latin America
Despite widespread economic growth and increasing social expenditures, Latin America remains one of the most unequal regions of the world. The region's highly regressive tax systems remain a huge hurdle to reducing poverty and inequality.
Issues in this Series
This article explores the success of Uruguay’s 2006 tax reform in (re-)introducing a comprehensive and progressive personal income tax while re-balancing direct and indirect taxes, eliminating inefficient taxes, and strengthening tax enforcement and compliance.
In their paper, Maynor Cabrera and Aaron Schneider argue that taxation is a clear indicator of state capacity, and Guatemala’s challenges collecting tax revenue point to the country’s institutional and structural weaknesses.
Brazilian expert José Roberto Afonso, analyzes the political economy of tax reform in Brazil (Portuguese). Executive summary available in English.
Vito Tanzi's keynote speech at our taxation event on December 11, 2013.
Brazilian researcher Saulo Santos de Souza of the Federal University of Pernambuco explores the multiple ways that politics shape and constrain tax reform in the region.
The paper provides an overview of the recent literature about the impact of taxation on inequality in the region, reviewing the major conclusions of recent empirical work and comparing Latin America to other regions of the world.
Last year, the Wilson Center and the Universidad de San Andrés in Argentina convened a conference featuring leading tax experts throughout the Hemisphere. The results are summarized in this bulletin.