The present study aims to calculate the effective tax rates on consumption and on labor as well as capital incomes for the Brazilian economy. To this end, we divide the households into ten different income groups based on the Household Expenditure Survey data (POF, 2002/2003) from IBGE. This information is used to compute the corresponding effective tax rates. The main results indicate a mild progressive structure of the income tax system and an almost flat rate of the effective consumption tax structure. This uniformity opens the possibility of great simplifications in the Brazilian indirect tax system: the prevailing indirect taxes can be substituted by just one uniform tax rate for all households with a neutral effect from an incidence point of view.
taxation; tax incidence; tax rates in Brazil
