EL PACTO FISCAL Y LOS SISTEMAS TRIBUTARIOS EN AMÉRICA LATINA (versión preliminar) Ricardo Martner Área de Políticas Presupuestarias y Gestión Pública, ILPES, CEPAL, Naciones Unidas

Motivación El pacto fiscal es el acuerdo sociopolítico básico que legitima el papel del Estado y el ámbito y alcance de las responsabilidades gubernamentales en la esfera económica y social A diez años de la publicación del Pacto fiscal, los desafíos no han variado, a pesar de la bonanza.

Cuatro principios para un Pacto fiscal Combinar responsabilidad fiscal con estabilidad macroeconómica Elevar la calidad del gasto público Promover la equidad Dotar de mayor transparencia a la acción fiscal y favorecer el desarrollo de la institucionalidad democrática

Recuperación del saldo público América Latina: Ingresos y gastos del gobierno central 1950-2007, promedio simple, % de PIB Fuente: Comisión Económica para América Latina y el Caribe (CEPAL), sobre la base de cifras oficiales.

Un fuerte aumento de los ingresos fiscales AMERICA LATINA Y EL CARIBE: VARIACION DEL INGRESO TOTAL DE LOS GOBIERNOS CENTRALES, 2002-2007 (En puntos del PIB) Fuente: Comisión Económica para América Latina y el Caribe (CEPAL), sobre la base de cifras oficiales.

Cuatro principios para un Pacto fiscal Combinar responsabilidad fiscal con estabilidad macroeconómica Elevar la calidad del gasto público Promover la equidad Dotar de mayor transparencia a la acción fiscal y favorecer el desarrollo de la institucionalidad democrática Para promover la equidad, se debe avanzar en la acción progresiva de la política fiscal

La desigual distribución del ingreso no ha variado América Latina y OCDE: cambios en el coeficiente de Gini, 1990-2004 Esta serie nos muestra que los problemas de solvencia con los cuales solemos caracterizar la PF de AL (aparte de su relación con el ciclo y su volatilidad) son de larga data. No obstante, cuando posamos la lente en las últimas dos décadas………………

Acción fiscal y equidad La contribución de las transferencias a la reducción del Gini es de 68% en promedio en la UE 15, y la contribución de los impuestos es de 32% Fuente: Cepal en base a información propia y Goñi, Lopez y Serven (2008) y Gomez Sabaini (2007)

Cobertura de pensiones: sólo 4 de cada 10 mayores de 70 años recibe alguna pensión (2005)

Ingresos tributarios: comparación OCDE y América Latina The overall tax burden can be thought of as reflecting society’s preferences for private and state provision of goods and services. As such, this empirical approximation should only be used as a rough indicator of the “optimal” size of tax collection. Notably, in the early nineties, most of the economies in Latin America privatised substantial shares of the provision of services in areas such as health care, education, social security systems and infrastructure. A number of observations arise from this chart. First, taking the region as a whole, the tax revenue as a percentage of GDP increased significantly over the last decades. Between 1990 and 2006, the overall tax revenue growth averaged close to 1.8% annually.   Second, the LAC's relative position vis-à-vis the OECD economies confirms a historically large income gap of 17.6 percentage points of GDP on average. LAC's relative performance improves if the comparison is restricted to Asian and North American developed countries – whose pattern of private and public provision of many services is more similar to LAC’s – with a gap of 10 percentage points of GDP. Third, regional averages hide significant differences between countries. These divergences are considerable in countries with higher public expenditures on social protection, such as Argentina and Brazil. In both countries, the ratio of public revenues to GDP averaged 30.6 % in 2006, about 1.8 times the regional average of the rest of the countries in the sample. Source: OECD (2007), Revenue Statistics 1965-2006 for OECD countries and Latin American Revenue Statistics for LAC. 10

Ingresos tributarios y PIB per capita (PPP, USD) Fuente: Fuente: ILPES, CEPAL, sobre la base de cifras oficiales elaboración propia sobre la base de cifras oficiales, "Revenue Statistics of OECD Member Countries” (OECD), 2007. WEO-Oct.2007(FMI). Notas: a/ Las cifras de la OECD tienen cobertura de Gobierno General, al igual que Argentina, Bolivia, Brasil, Chile, Colombia, Costa Rica. Las cifras para ingresos son provisionales.

Estructura Ingresos Tributarios de la OCDE (Porcentaje del total)

Raising the share of indirect taxes to 40 per cent of total tax revenues shift to 40% share of indirect taxes: EU15 GDP and employment Among the challenges Latin America faces today are poverty and inequality. Inequality in LAC, measured in Gini coefficients, remains at high levels compared to European countries. Income distribution and wealth have a large impact on income tax collection, and a huge impact on the differences between income tax collection in Finland and Chile. Large variations within income brackets can be seen at this figure. For example, 74 per cent of Chilean tax payers have incomes below 5 000 euros, versus only 12 per cent of Finnish tax payers. Note: Solid line GDP, dotted line employment (percentage differences from baseline). Source: oecd 13

Growth regressions (OECD countries) The regressions distinguish effects from fiscal policy on the expenditure and the revenue side. On the expenditure side, the size of the government is measured by the share of government consumption in GDP (CGY). On the revenue side we concentrate on the structure of financing, and we use the ratio of indirect to direct taxation (TAXID) as an indicator. Dependent variable: Real GDP growth per capita Variable Coeff T-Stat Signif 1. log (YWP) -0.062 -4.32 0.00 2. log (TAXID) 0.012 1.59 0.11 3. log (CGY) -0.073 -3.88 0.00 4. log (OPEN 0.118 1.08 0.28 5. log (OPENSIZE) -0.032 -0.85 0.39 6. log (FRASER) 0.054 3.14 0.00 7. log (IY) 0.033 2.59 0.01 8. log (RDY) 0.029 3.23 0.00 9. log (gpop+delta) -0.26 -1.19 0.23 Observations: 98 Among the challenges Latin America faces today are poverty and inequality. Inequality in LAC, measured in Gini coefficients, remains at high levels compared to European countries. Income distribution and wealth have a large impact on income tax collection, and a huge impact on the differences between income tax collection in Finland and Chile. Large variations within income brackets can be seen at this figure. For example, 74 per cent of Chilean tax payers have incomes below 5 000 euros, versus only 12 per cent of Finnish tax payers. Source: oecd 14

Estructura Ingresos Tributarios AL AMÉRICA LATINA: ESTRUCTURA INGRESOS TRIBUTARIOS (Porcentaje del total)

Estructura tributaria Another central issue in public economics involves the suitable design of a tax system. Because raising tax revenues affects economic performance, a general objective for tax policy is to collect the desired levels of revenues maintaining efficiency, equity and simplicity. Major differences between OECD and Latin American countries can be observed in this chart. First, the personal income tax and social security contributions play a secondary role as a source of revenue in LAC compared to OECD economies. Notably, the tax burden of these categories is 13.8 percentage points of GDP lower in LAC than in developed economies, which correspond to 92% of the total tax gap between the two groups. Second, the low share of direct taxes in the region is counterbalanced by higher shares of indirect taxes. As a share of GDP, tax revenues levied on an indirect basis are close to European levels and 2 percentage points higher than in Asia and North American economies.   Finally, taxes on payroll and workforce and property contribute considerably less than the previous categories to total revenues and exhibit a similar pattern in LAC and in the OECD. These general differences in the tax mix are probably linked with administrative considerations. The prevalence of informal employment and income inequality in Latin American countries may impose additional costs in tax compliance for direct taxation. In contrast, LAC’s reliance on consumption taxes stems from the relative ease of collecting this kind of revenue, because the VAT tax base is invariably broader than that of other taxes. Source: OECD (2007), Revenue Statistics 1965-2006 for OECD countries and Latin American Revenue Statistics for LAC. 16

Impuestos a la renta Los impuestos a la renta de las personas representan 1.3 por ciento del PIB en AL, comparado con un promedio de de 9 por ciento en la OCDE. Whereas tax structures are fairly well balanced between direct and indirect taxes in most OECD countries, direct taxation is particularly low in Latin America. This is especially true for personal income taxes, which in average, constitute only about 1.3 per cent of GDP. This is a low figure when compared with the OECD average of 9 per cent. Note: Due to disaggregation problems, in some LAC it was not possible to assign some taxes to the main categories (corporate and individuals). This is why the “unallocable” category is higher in LAC than in OECD. In subsequent versions of the Latin American Revenue Statistics, we will reduce the number of taxes placed in the unallocable category. Source: OECD (2007), Revenue Statistics 1965-2006 for OECD countries and Latin American Revenue Statistics for LAC. 17

El gasto tributario Source: National government budgets. There is no agreement on the definition of tax expenditures and the methodology for compiling statistics differs across countries. Consequently, the statistics given here are not strictly comparable. The tax expenditure estimates for each country are presented. The statistics were compiled using the Government Budget in the most recent year for which data are available. For some countries – Argentina, Brazil and Peru – the impact of tax expenditures on revenues is limited. Other countries, such as Chile, Mexico and Guatemala, exhibit higher values. Tax expenditures in these countries are mostly concentrated in general taxes on consumption and income taxes, especially in personal income. Source: National government budgets. 18

IVA: Recaudación y tasas promedio Productividad del IVA en América Latina, 2006. Fuente: ILPES/CEPAL, sobre la base de cifras oficiales de cada país. Notas: a/ Las cifras de Argentina incluyen ingresos por IVA coparticipados y en Brasil se refieren a recaudación estadual.

Exploring taxpayers’ characteristics The “tax collection gap” between Chile and Finland is large at every income level – particularly at the median incomes where Finnish authorities collect more than ten times what their Chilean counterparts do. In order to explore the characteristics of taxpayers in OECD and LAC countries, we have requested special information from national tax agencies, based on individual income tax returns. The statistics include, by income level, the number of taxpayers, assessed income, taxes paid and income composition. The data set covers a wide range of countries but the quantitative results are under construction. For illustrative purposes, we present statistics for Chile and Finland, which provide a striking contrast between LAC and OECD countries’ performance, using data from the most recent year available (2005). This figure shows that the “tax collection gaps” – in terms of GDP, the volume of taxes collected for each income level – are large between the two countries at every income level. In particular, the differences are higher for the median incomes, where the Finnish tax agency collects more than ten times what its Chilean counterpart does. So, “What is the source of the differences between Finland and Chile in terms of personal tax collection?” Source: Internal Revenue Service (SII) and Finnish Tax Administration. 20

Exploring taxpayers’ characteristics Income distribution and wealth have a large impact on income tax collection. Among the challenges Latin America faces today are poverty and inequality. Inequality in LAC, measured in Gini coefficients, remains at high levels compared to European countries. Income distribution and wealth have a large impact on income tax collection, and a huge impact on the differences between income tax collection in Finland and Chile. Large variations within income brackets can be seen at this figure. For example, 74 per cent of Chilean tax payers have incomes below 5 000 euros, versus only 12 per cent of Finnish tax payers. Source: Internal Revenue Service (SII) and Finnish Tax Administration. 21

Simulación de una reforma radical (Chile) Se eleva la participación de los impuestos directos desde un 27% a un 56% Fuente:Jorge Cantallopts, Michel Jorratt y Danae Scherman (2007): “Equidad tributaria en Chile: un nuevo modelo para evaluar alternativas de reforma”

Simulación de una reforma radical (Chile) Fuente:Jorge Cantallopts, Michel Jorratt y Danae Scherman (2007): “Equidad tributaria en Chile: un nuevo modelo para evaluar alternativas de reforma”

Y entonces..porqué la resistencia al cambio? Los cambios más sustanciales son posibles durante las crisis. Como corolario, las reformas no están en la agenda (excepto México, RD y Venezuela) No existen mayores presiones externas Las reformas son endógenas al ciclo electoral Las élites se resisten al cambio, lo que es otra forma de decir que la mala distribución del ingreso se reproduce...

Los “paliativos” Impuestos “heterodoxos” A las transacciones financieras A las exportaciones Regímenes especiales a pequeños contribuyentes Renta presunta Impuesto empresarial de tasa única

EL PACTO FISCAL Y LOS SISTEMAS TRIBUTARIOS EN AMÉRICA LATINA (versión preliminar) Ricardo Martner Área de Políticas Presupuestarias y Gestión Pública, ILPES, CEPAL, Naciones Unidas