Inclusive Growth and the Incidence of Fiscal Policy in Mauritius: Much Progress, But More Could be Done

Antonio David and Martin Petri

No 2013/116, IMF Working Papers from International Monetary Fund

Abstract: Using data from three household surveys, we review whether growth in Mauritius was inclusive and discuss the incidence of public expenditures and taxes. Generally, Mauritius enjoys an even income distribution and low rates of poverty. Nevertheless, over the 2000s, despite overall progress, the benefits of growth appear to have become more skewed. Employment income is the main contributor to inequality in Mauritius. Social protection expenditures reduce poverty and inequality, but could be better targeted, particularly for pensions. Income taxes are progressive, though given their small relative weight they have a negligible impact on income distribution. The VAT appears relatively progressive compared to other developing countries, although its impact on the overall distribution is also small. With better targeting of the sizable social spending, significant further progress in poverty alleviation could be achieved.

Keywords: WP; income tax; VAT; Mauritius; income; Inclusive Growth; Incidence of Public Expenditures; Incidence of Taxes; physical capital; household consumption measure; independence Mauritius; VAT payment; employment income; expenditure survey; income taxes in Mauritius; incidence in Mauritius; Personal income; Income inequality; Income tax systems; Income distribution; Africa; Central America (search for similar items in EconPapers)
Pages: 28
Date: 2013-05-17
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Citations: View citations in EconPapers (11)

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