Mozambique/Raul-Soler

Work-in-progress workshop:

Tax-benefit microsimulation analysis
UNU-WIDER is organizing a project workshop to discuss research papers currently being written on tax-benefit microsimulation analysis under the SOUTHMOD – simulating tax and benefit policies for development project.

The workshop brings together the researchers and selected international experts from various institutes (University of Essex, KU Leuven, and Southern African Social Policy Research Insights) to present the work-in-progress on tax benefit microsimulation analysis. The research work relates to the selected proposals resulting from the request for research proposals, announced online earlier by UNU-WIDER, in order both to improve the understanding of tax-benefit systems and their role in developing countries, and to increase the use of tax-benefit microsimulation models.

The research initiative, part of UNU-WIDER’s 2014–18 research programme, aims at deepening the understanding of tax-benefit systems and their implications in developing countries. The aim is to understand better the role of tax-benefit policy in developing countries regarding poverty reduction and inequality, to contribute to a better understanding of modelling behavioural effects within tax-benefit microsimulation models to inform the policy debate, and to push the limits of tax-benefit microsimulation models in areas posing challenges — specifically when applying tax-benefit microsimulation in a developing country context, such as the role of indirect taxes, informality, and tax evasion.

Many developing countries are currently building up their social protection systems and the financing of public spending will need to be increasingly based on domestic tax revenues. In this process, understanding the system-wide impacts of different policy choices is critically important, and tax-benefit microsimulation models are very well suited for this purpose.