Brazil still plagued by inequality, survey shows

Six of Brazil's biggest millionaires hold the same wealth as the 100 million poorest Brazilians. If market inclusion remains at the same pace as it has been for the best 20 years, women will only be paid as much as men in 2047, and the average income of blacks and whites will not be leveled before 2086. According to forecasts by the World Bank, by the end of 2017, the country will have 3.6 million new poor people.

These are the findings revealed in a report entitled The Distance that Unites Us: an Overview of Inequality in Brazil, released this week by Oxfam Brasil. For the first time, the organization—which works in the fight against poverty and inequality—published a study investigating solutions for a country where income, wealth, and basic services are so poorly distributed.

Oxfam Executive Director Karla Maia said the goal is to release a yearly report on equality and show the problems linked to it, like taxes. “We do pay a lot of taxes, but it doesn't mean taxes are too high. Rather, the tax system is actually unfair. We're below the average for OECD [Organization for Economic Co-operation and Development] member countries [in tax load]. It's a burden to be borne chiefly by the middle class and the poorer sections of the population,” she said.

Indirect taxes

The documents names flaws like the way taxes are collected in Brazil compared to other countries. In addition to high indirect taxes, the report questions tax breaks on companies' profits and dividends and the wealth tax, which contributes to the increase in the concentration of wealth in the hands of the richest.

Maia believes that Brazilian authorities can make efforts to facilitate proportionally egalitarian taxation even before a tax overhaul is carried out. One of the problems to be addressed, she pointed out, is tax evasion. In 2016 alone, over $85 billion went uncollected, according to official figures.

As one of recent achievements, the report refers to the labor market as the main factor reducing income inequality in Brazil. The stabilization of the economy and the inflation of the last 20 years enabled the country to invest in employment generation, increase the minimum wage and boost the growth in formal jobs. Some inequalities, however, are said to still need tackling, like common salary gaps between equally educated men and women and blacks and whites.

Translated by Fabrício Ferreira