Maya Forstater

Interested to see @MForstater's view in 280 characters too....

As Richard Bird said back in 2005 (paraphrasing) Progressive taxation in developing countries is really hard . https://papers.ssrn.com/sol3/papers.cfm?abstract_id=804704&download=yes … I am not sure that the dilemmas that Richard sets out have changed

My take away from @noralustig & cos. work is not that progressive taxation has not been tried, but that even progressive tax systems (combined w insufficient transfers) can make significant numbers of people at the bottom of the income scale worse off.

e.g. the story from the CEQ Tanzania paper is that the tax system overall is progressive. The VAT is moderately progressive. Only kerosene tax & tobacco tax are regressive. http://www.commitmentoequity.org/wp-content/uploads/2017/05/CEQ-WP36-Fiscal-Incidence-in-Tanzania-3-Jan-16-2016.pdf ….... but still it increases number of people below $1.25 by 20%

I hope we didn't call Tanzania's tax system regressive, but acknowledge we didn't really discuss one of the core tensions here: even moderately progressive systems in low income countries are likely to be immiserating.

Yes Vox article suggests its pretty easy, simple ... but at least on the tax side in TZ, CEQs does not see a simple fix. Says 'be content with tax system' and increase cash transfers, remove electricity subsidy, spend less on post-secondary ed, more on primary

One of our main arguments is against that latter recommendation. Or at least against spending >$100 per head on schools for kids who consume <$100 a year total, and counting that as a transfer at cost -- even if the kids don't learn anything.

Building out state capacity to do targeted transfers at scale seems like a good priority imo.