Table 7. Coverage of non-contributory pensions in Latin America and
Southern Africa, 2008
Source: HelpAgeInternational (2006b); Notes: Brazil 1 and 2 = Beneficio de Prestacao Continuada;
Previdencia Rural.
There are not yet detailed studies on the net redistributive effects of
the tax and social expenditures discussed above. Until the late 1990s,
the net redistributive effect of tax-and- transfer operations in Latin
America w a s much smaller than t h a t of the OECD countries
(Table 8), with the exception of Argentina and Costa Rica. In
most countries, redistribution operated exclusively on the
expenditure side. An analysis of tax incidence in 11 Latin American
countries (Gomez-Sabaini 2006) concludes that the distribution of
income after taxation (but before transfers) remained broadly
unchanged, and even worsened in Mexico and Nicaragua where
the tax system mainly relied on regressive or proportional taxes
such as excises and VAT. Yet, as noted above, the increase in
income a n d w e a l t h t a x e s recorded between 2002 and 2007,
especially in LOC countries, points to a gradual evolution of the
tax system towards greater progressivity.