The Distributional Impact of Fiscal Policy in Jordan

Shamma Alam, Gabriela Inchauste and Umar Serajuddin
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Shamma Alam: Dickinson College

No 44, Commitment to Equity (CEQ) Working Paper Series from Tulane University, Department of Economics

Abstract: This paper analyzes the impact of Jordanian government’s fiscal policies on poverty and inequality in the country. The CEQ methodology is applied o analize all the key fiscal policies employed by the government, such as direct taxes (personal income taxes); indirect taxes (sales taxes); direct transfers; indirect subsidies (subsidies for food, oil, electricity, and water); and in-kind benefits (benefits for education and health). The results indicate that the Jordan’s policies are mostly progressive and equalizing, primarily through direct taxes, direct transfers, indirect subsidies, and in-kind benefits. Moreover, the results show that the combination of tax and expenditure policies is poverty-reducing. However, the indirect tax system, in its current form, is slightly regressive and inequality-increasing, as the poor are paying a greater fraction of their income than the rich as sales tax.

Keywords: fiscal policy; fiscal incidence; social spending; inequality; poverty; taxes; Jordan (search for similar items in EconPapers)
JEL-codes: D31 H22 I38 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2017-05
New Economics Papers: this item is included in nep-ara
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

Published in Commitment to Equity, May 2017, pages 1-29

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http://repec.tulane.edu/RePEc/ceq/ceq44.pdf First version, 2017 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:tul:ceqwps:44

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