Options for Low Income Countries’ Effective and Efficient Use of Tax Incentives for Investment : Tools for the Assessment of Tax Incentives

International Monetary Fund ; OECD ; United Nations ; World Bank

World Bank, Washington, DC

关键词: TAX INCENTIVES;    INTERNATIONAL INVESTMENTS;    HOLDING;    LIABILITY;    MARKET STRUCTURE;   

RP-ID  :  100757

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

This background paper describes fivedifferent tools that can be used for the assessment of taxincentives by governments in low income countries’ (LICs).The first tool (an application of cost-benefit analysis)provides an overarching framework for assessment.Evaluations of the various costs and benefits of taxincentives are vital for informed decision making, but arerarely undertaken, partly because it can be a difficultexercise that is demanding in terms of data needs. The nextthree tools (tax expenditure assessment, corporate microsimulation models, and effective tax rate models) can beused as part of a comprehensive cost-benefit analysis, toshed light on particular aspects. Effective tax rate modelsshed light on the implications of tax parameters - includingtargeted tax incentives - on investment returns and helpunderstand the implications of reform for expectedinvestment outcomes. The document presents two tools forassessing the transparency and governance of tax incentivesin LICs. These discuss principles in transparency andgovernance of tax incentives, and allow for benchmarkingexisting LIC practices against better alternatives.