Os Efeitos da Inflação Sobre o Orçamento do Governo: Uma Análise Empírica

Abstract

This paper attempts to evaluate the effects of inflation on the government budget. We examine the inflation effect due to lags in tax collection (the Tanzi effect), on the real value of tax revenue and also the level of tax indexation. We follow the model presented by Barbosa (1987), applying a different estimation method based on time varying parameters. The results show all taxes are indexed to the price level and that the Tanzi effect reduces the real value of taxes. Inflation has a transitory, but not permanent, effect on pay roll expenditure. Our estimates show also that both income elesticities of the tax revenue and expenditures have been increasing during the nineties. Moreover, after 1994 the expenditures income elasticity is greater than revenue income elasticities, which indicates a structural fiscal problem.