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Linear Symmetric “Fat Taxes”: Evidence from Brazil
Author(s) -
Leifert Rodrigo M.,
Lucinda Claudio R.
Publication year - 2015
Publication title -
applied economic perspectives and policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.4
H-Index - 49
eISSN - 2040-5804
pISSN - 2040-5790
DOI - 10.1093/aepp/ppu062
Subject(s) - subsidy , schedule , estimation , economics , government (linguistics) , public economics , tax revenue , revenue , econometrics , finance , linguistics , philosophy , management , market economy
According to the World Health Organization, the obesity epidemic is a threat. Brazil is not an exception, and the objective of this article is to analyze the effects of a “fat tax” there. For this purpose, the estimation of a demand system was carried out and policy simulations were performed using the estimated parameters. The simulation results indicate that to be successful, this “fat tax” must be combined with a subsidy on healthy food. Another contribution was the analysis of a linear symmetric revenue‐neutral tax schedule with more pronounced changes to micronutrient intake at no net cost to the government.