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25/11/2014 | Latin America - Peru’s govt measures to improve income distribution among population

Andina - Staff

Lima - The measures adopted by the government will improve the income distribution among the population, as they are progressive and tend to reduce inequalities among the different social classes, said the Ministry of Economy and Finance (MEF).

 

According to the Economic Revitalization Bill, the government’s initiatives favor the improvement of income distribution, which is reflected on the reduction of Gini index, the most common income inequality indicator.

This way, the Gini index for taxpayers with an annual gross income exceeding seven Tax Units falls from 0.3549 to 0.3545. 

In addition, MEF highlights that without taxes, the income inequality ratio can increase to 0.3892. 

Along these lines, the ministry said the bill -expected to be taken up by the Congress as soon as possible- reduces the tax rate paid by most individuals.

“Furthermore, the reduction translates into incentives for the formalization of workers,” the ministry stated.

This tax revision would not impact low-income families, since the cost of the annual Basic Food Basket for a standard four-member family is 3.2 Tax Units.

(END) JJN/JJN/RMB

Andina (Perú)

 



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