Equity in finance
An important health system goal is equity in finance. This means that the burden of financing the health system is shared fairly across the population.
Measuring equity in finance looks at whether the burden falls disproportionately on the better-off or worse-off in society, relative to their capacity to contribute. An equal burden across the population is referred to as proportionate.
Of these, income tax revenues tend to be progressive. However, income taxes are only progressive if rates are higher for people with higher incomes.
Payroll taxes tend to be proportionate. However, ceilings on payroll tax contributions mean that those who earn above the ceiling level contribute a lower share of salaries. The specific situation in each country needs to be carefully assessed.
These tend to be regressive, especially out-of-pocket payments. However, some specific policies such as exempting basic food items from value-added tax (VAT), or having higher rates on luxury items may change this picture.