30% of total net national income, the same share received in 2003. The top 0.1% received approximately 20% of income throughout the period. Broader measures of top income shares show decreases in the period – the top 10% share decreased from 60% in 2003 to 55% in 2019. These levels of income concentration place Honduras among the most unequal countries in the world. According to WID (2022), the richest 10% of the global population currently claims 52% of the world’s income. The Middle East and North Africa (MENA) region stands out as the most unequal region in the world (58%), while Latin America follows closely behind (55%). Moreover, Bergolo _et al._ (2023) show that in Latin America, the top 1% of earners receive approximately 20% of total income - this represents the highest concentration of income among regions globally. Within the region, only Mexico and Peru, where the top 1% receive 27% and 28%, respectively, register inequality levels similar to the ones we document in Honduras. As we discuss in more detail below, this might be partially driven by the lack of granular income data at the top of the distribution for other countries in the region.

The detailed tax records we use allow us to provide a granular description of levels and composition of income at the very top of the distribution. We show that, while labor income represents close to 90% of total income for individuals all the way to the top 1%, within the top 1% highest earners, capital income becomes very important: it represents half of income for those in the top 0.1% and more than 80% for those within the top 0.01% highest earners. We also document that the trends in capital vs. labor share in the top 1% fully drive total income shares - the share of labor in total income decreased from 70% in 2011-2014 to close to 62% by 2019, with barely any change in the shares of the bottom 99% of earners but a large shift toward capital income in the top 1%.

This contributes to the research on at the paper agenda measuring inequality top of the distribution in low- and middle-income countries. Many of the studies using tax registries, both in middle- and high-income countries, start from tabulated data of high-income earners provided by governments and use interpolation techniques to estimate income levels and composition at the top of the distribution. Working with SAR, the tax authority in Honduras, we use anonymized panel datasets at the taxpayer level, which lets us depict a very granular description of top earners. Furthermore, the panel data we use allows us to show that not only the level of income concentration remained stable over two decades in Honduras, but also the identity of individuals at the top is highly persistent: we show that more than half of the individuals belonging to the top 0.1% of the distribution in any given year will stay above that level in a three year horizon. Comparisons with the level of individual persistence at the top in other low- or middle-income countries is hard due to lack of data availability, but these rates are closer to 30-40% in high-income countries such as Norway and Australia (Alstadsæter _et al._ , 2016, H ́erault _et al._ , 2022). Additionally, we document the prevalence 2