Redistributive Effects of Indirect Taxes in Turkey 2003

Özlem ALBAYRAK

Öz


This article examines the redistributive impacts of indirect tax policies in Turkey. By applying S-Gini Indices to measure progressivity with different inequality aversion parameters, we examine if indirect taxes are progressive or not in Turkey. We make the standard tax incidence analysis by using statutory tax rates on final goods. In addition to the standard tax incidence analysis, we estimate effective tax rates by using Input-Output tables to cover the impact of taxation on imported and intermediary goods. The results show that the incidence of indirect taxes is sensitive to the welfare indicator chosen. While the indirect taxes reduce expenditure inequality, they increase income inequality. Effective indirect tax rates prove the importance of taxation on imported goods and intermediate goods, which are ignored by the standard tax incidence analysis.

Anahtar Kelimeler


Inequality; Tax Incidence; Redistributive Effect; Progressivity

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