Options for Low Income Countries Effective and Efficient Use of Tax Incentives for Investment : A Report to the G-20 Development Working Group by the IMF, OECD, UN and World Bank

International Monetary Fund ; OECD ; United Nations ; World Bank

World Bank, Washington, DC

关键词: TAX INCENTIVES;    TARIFFS;    LIABILITY;    FOREIGN CAPITAL;    EQUIPMENT;   

RP-ID  :  100756

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

Experience shows that there is oftenample room for more effective and efficient use ofinvestment tax incentives in low-income countries. Taxincentives generally rank low in investment climate surveysin low-income countries, and there are many examples inwhich they are reported to be redundant, that is, investmentwill have been undertaken even without them. And theirfiscal cost can be high, reducing opportunities formuch-needed public spending on infrastructure, publicservices or social support, or requiring higher taxes onother activities. This paper responds to a request of theG20 Development Working Group for an exploration of optionsfor low-income countries’ effective and efficient use of taxincentives for investment. To that end, it developsprinciples for the design and governance of tax incentivesand provides guidance on good practices in these areas.Since much of the pressure to offer incentives stems from anawareness of those offered by other countries, the paperalso discusses options for international coordination toaddress the risk of mutually damaging spillovers from suchtax competition. Finally, a separate background documentdevelops practical tools and models that can help assess thecosts and benefits of tax incentives, which is essential forinformed decision making. The aim is thus to assistlow-income countries (LICs) in reviewing and reforming theirtax incentives, so as to better align them with theirdevelopmental objectives. This paper relates to other globalinitiatives aimed at strengthening domestic revenuemobilization in LICs.