Changes in fiscal policies can have significant impact on both poverty and income inequality. An analysis of the incidence of taxation and expenditures on different population segments reveals how fiscal policy influences income distribution, allowing governments to gauge the impact of current policies and evaluate policy options. Fiscal incidence analysis can support changes in fiscal policy. This report presents policy simulations that consider the revenue and distributional impacts of possible changes in the design of expenditure programs or instruments for revenue collection in Timor-Leste. The methodology, analysis, and results presented in this report will be beneficial to stakeholders in Timor-Leste and offer important insights for other countries in Asia and the Pacific.
