Tax Structure and Tax Burden in Brazil: 1980-2004

Oliveria, José Teófilo; Giuberti, Ana Carolina

This paper is an attempt to describe and exhibit the main features of the Brazilian tax system from 1980 to 2004. In the selected period, the Brazilian economy experienced a faulty economic growth process in the presence of very high rates of inflation. In essence, what is shown here is significant upward movement of the total tax revenue in the country from a level of 25 percent of GDP to an all time high of 32.8 percent in 2004. In addition it is argued that this effort to raise additional revenue occurred in the 1990s and is primarily explained by social security expenditures and by interest payments on public debt. The data collected also indicate that the tax system is dominated by indirect forms of taxation. The use of taxes on goods and services represented near 50 percent of the total tax revenue for most of the period. The paper identifies the key changes in the tax laws in the period and the current problems of design and administration of the tax system. Finally the macroeconomic context is presented and an attempt is made to relate the ups and down in the rates of economic activity and inflation to tax revenues and internal and external debt.



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Initiative for Policy Dialogue
Initiative for Policy Dialogue
Initiative for Policy Dialogue Working Paper Series
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October 28, 2012