When used in a non-technical context, there is generally a presumption that tax-benefit systems reduce inequalities by transferring resources to those in greater economic need (i.e., by taxing people and using the revenue to finance transfers). However, public policies alter income inequality even when no interpersonal transfer takes place. For instance, a progressive tax reduces inequality by itself, even if the proceeds are not used to finance transfers, while a lump-sum tax increases it.