世界银行-税收和转移支付对巴基斯坦不平等和贫困的影响（英）-2025_106页_2mb

Summary of The Effects of Taxes and Transfers on Inequality and Poverty in Pakistan

Core Content

This study analyzes the impact of Pakistan's fiscal policy on poverty and inequality using the Commitment to Equity (CEQ) Methodology for the fiscal year 2018–19. It assesses the distributional effects of taxes, social expenditures, and subsidies on households' welfare, aiming to support pro-poor policy design and improve fiscal equity.

Main Findings

1. Impact on Poverty and Inequality

• Poverty Headcount: Fiscal policy in 2018–19 increased the national poverty headcount by approximately 2.3 percentage points.
• Inequality: The Gini coefficient index of inequality decreased slightly from 29.0 to 28.6, indicating a marginal reduction in inequality.
• Net Payers and Receivers: Most households are net payers into the fiscal system, with only the poorest decile being net recipients.

2. Effectiveness of Fiscal Instruments

• BISP Social Protection Program: The most effective expenditure-side instrument for reducing inequality and poverty.
• Personal Income Tax (PIT): The most effective revenue-side instrument for reducing inequality.
• Indirect Taxes and Subsidies: Less effective in reducing poverty and inequality. Indirect taxes, particularly GST, have a large negative impact on poverty, but their regressive nature contributes to inequality.
• In-Kind Transfers: Public health and education services have an insignificant impact on inequality.

3. Distribution of Benefits and Burdens

• The two richest deciles capture a large share of subsidy and in-kind benefits (34% of total subsidies, 29% of in-kind education benefits, and 27% of in-kind health benefits).
• They also pay 40% of total indirect tax revenues and over 90% of direct taxes.
• The two poorest deciles receive approximately 53% of total direct transfer spending.

4. Marginal Contributions

• GST has the largest marginal contribution to the increase in poverty headcount.
• BISP Unconditional Cash Transfer (UCT) has the largest marginal contribution to inequality reduction.
• Pre-primary and primary education also have a significant positive impact on inequality reduction.

5. Cost-Effectiveness

• BISP transfers are the most cost-effective expenditure policy for reducing both inequality and poverty depth.
• Direct taxes are the most cost-effective revenue policy for inequality reduction while protecting poor households.
• Indirect subsidies (on energy and agricultural inputs) are relatively ineffective in reducing poverty and inequality.

6. International Comparison

• Pakistan has the highest poverty increase and the lowest inequality reduction among comparator middle-income countries.
• This is attributed to:
  • Low tax-to-GDP ratio (13.4%).
  • Heavy reliance on indirect taxes which are more regressive.
  • Rigid public expenditures (salaries, pensions, debt service).
  • Inefficient and regressive general subsidies on energy and agricultural inputs.

7. Policy Implications

• Pakistan needs to improve domestic revenue mobilization and public expenditure efficiency to create more fiscal space.
• Additional fiscal space should be used to expand social expenditure and targeted transfers.
• Fiscal reforms should focus on:
  • Reducing regressive and inefficient subsidies.
  • Enhancing progressive direct taxation.
  • Improving accessibility and quality of public health and education services.
• These reforms align with the World Bank's Poverty and Shared Prosperity Report (2022).

Key Instruments and Data

• Taxes Included: General Sales Tax (GST), customs duties, federal excise duty, withholding tax on salaries and telecommunications, and property tax.
• Social Expenditures Covered: Conditional and unconditional cash transfers under BISP, indirect subsidies (electricity, natural gas, agricultural inputs), and in-kind benefits (health and education).
• Data Sources: Pakistan Household Integrated Economic Survey (HIES) 2018–19, along with fiscal, budgetary, and administrative data from federal and provincial governments.

Methodological Innovations

• Inclusion of zakat (religious taxes and transfers) in the analysis.
• Modeling informality in household consumption based on Bachas et al. (2020).
• Use of CEQ Methodology to assess the joint distributional impacts of fiscal instruments.

Conclusion

The study highlights the need for fiscal reforms that prioritize equity and sustainability. It emphasizes the importance of targeted social transfers and progressive taxation in reducing poverty and inequality, while also pointing out the inefficiencies and regressive nature of current fiscal instruments. The findings serve as a baseline for future policy reforms in Pakistan.

References and Appendices

• The study is based on the World Bank's Poverty & Equity Global Practice and uses CEQ Methodology.
• It includes six annexes with detailed information on:
  • Fiscal parameters of the model.
  • Methodology for estimating public sector employees and labor informality.
  • Estimation of indirect effects using the Input-Output (IO) Matrix.
  • Detailed relative and absolute incidence analysis.
  • Fiscal interventions excluded from the model.
  • Data limitations and recommendations for future research.

Figures and Visuals

• Figure ES1: Net payers and receivers across deciles.
• Figure ES2: Pakistan's low inequality reduction among comparator countries.
• Figure ES3: Pakistan's high poverty increase among comparator countries.

This analysis underscores the critical role of fiscal policy in shaping poverty and inequality outcomes and provides a foundation for evidence-based policy reforms.