THE COMBINED INCIDENCE OF TAXES AND PUBLIC-EXPENDITURES IN THE PHILIPPINES

Of central concern to policy makers, the net incidence of fiscal polic y is rarely calculated because of the lack of reliable data on the inc idence of both taxes and expenditures. This paper calculates the combi ned incidence of taxes and certain public expenditures in the Philippi nes, using various short-cuts. We find that the incidence of indirect taxes is broadly neutral, because of general-equilibrium effects. Exam ining the regional allocation of expenditures and pattern of income di stribution, we find that health, education and infrastructure expendit ures are progressive. Our conclusion-that the net fiscal incidence in the Philippines is progressive-appears robust to sensitivity analyses. (C) 1998 Elsevier Science Ltd. All rights reserved.