posted on 2024-09-05, 23:43authored byLaura Bolton
Financing for social protection often comes from government funds. Any way of expanding fiscal
space could therefore be useful with the political will for prioritisation (UNESCP, 2016). Egypt
created an Economic Justice Unit in the Ministry of Finance to review expenditure priorities, and
Costa Rica and Thailand shifted military spending to finance universal health services (Ortiz et
al., 2015b).
Ortiz et al. (2015) offer options for government to increase social investment: reallocating public
expenditures, increasing tax revenues, expanding social security coverage and contributory
revenues, lobbying for aid and transfers, eliminating illicit financial flows, using fiscal and foreign
exchange reserves, borrowing or restructuring existing debt and, adopting a more
accommodative macroeconomic framework. The authors advise against VAT or consumption tax
increases as they have a negative social impact unless targeted to luxury goods.
Taxes on items that create negative externalities such as beer, cigarettes or petroleum may be
more politically acceptable if proceeds are spent improving social issues (Ortiz et al., 2015).
There are benefits for public and personal health as consumption is discouraged. In the Philippines a tax on gaming corporations supports National Child Development Centers which provide integrated services for children from birth to 4 years old (Putcha et al., 2016).
Funding
Default funder
History
Publisher
Institute of Development Studies
Citation
Bolton, L. (2017). Innovative financing methods for social protection. K4D Helpdesk Report. Brighton, UK: Institute of Development Studies.