Why Worry About Tax Expenditure?
Tax expenditures are concessions that fall outside tax norms or benchmarks. These norms include accounting conventions, the structure of tax rates, the deductibility of compulsory payments, provisions to facilitate tax administration, and norms rel...
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okr-10986-113272021-04-23T14:02:55Z Why Worry About Tax Expenditure? Swift, Zhicheng Li Cavalcanti, Carlos B. ACCOUNTING BUDGET PROCESS DEDUCTIONS ECONOMIC DEVELOPMENT ECONOMICS EFFECTIVE TAX RATES ENTITLEMENTS EXPENDITURES FEDERAL GOVERNMENT FISCAL FISCAL TRANSPARENCY GOVERNMENT BUDGETS GOVERNMENT EXPENDITURES GOVERNMENT SPENDING INCOME INCOME TAX MINISTERS MINISTRY OF FINANCE POLICY RESEARCH PRESIDENCY PRIVATE SECTOR PRIVATE SECTOR PARTICIPATION PRODUCERS PROVISIONS PUBLIC EXPENDITURE SOCIAL DEVELOPMENT SOCIAL PROGRAMS TAX TAX ADMINISTRATION TAX BASE TAX BENEFITS TAX BRACKETS TAX DEDUCTION TAX EXPENDITURE TAX EXPENDITURES TAX LAWS TAX LIABILITIES TAX PAYMENTS TAX RATE TAX RATES TAX REGIME TAX RETURNS TAX REVENUE TAX REVENUES TAX SYSTEM TAXABLE INCOME TAXATION TAXPAYERS TAX EXPENDITURES BENCHMARKS TAX ADMINISTRATION FISCAL POLICIES POLICYMAKERS TAX EXEMPTIONS ALLOWANCES CREDITS DEFERRALS TAX DEDUCTION CHARITABLE CONTRIBUTIONS UNSKILLED WORKERS GOVERNMENT BUDGETS Tax expenditures are concessions that fall outside tax norms or benchmarks. These norms include accounting conventions, the structure of tax rates, the deductibility of compulsory payments, provisions to facilitate tax administration, and norms related to international fiscal obligations. Tax expenditures are deviations from these norms, implemented to encourage behavior deemed desirable by policymakers, and can take a number of forms-including tax exemptions, allowances, credits, deferrals, and relief (see OECD 1996). The classic example is a tax deduction for charitable contributions, where the reduction in tax revenue is more than offset by the increase in support for charitable activities. Tax expenditures are not a free lunch, however. They can lead to inefficiencies and inequities, stimulating no additional activity and making the tax regime more regressive. For instance, a tax concession granted to employers who hire unskilled workers might go to employers who would have hired such workers anyway. Tax expenditures also affect government budgets, because they imply forgoing revenue that could be used to fund direct government expenditures. 2012-08-13T14:46:08Z 2012-08-13T14:46:08Z 2003-01 http://documents.worldbank.org/curated/en/2003/01/2518855/worry-tax-expenditure http://hdl.handle.net/10986/11327 English PREM Notes; No. 77 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Brief Publications & Research |
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Digital Repository |
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Foreign Institution |
institution |
Digital Repositories |
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World Bank Open Knowledge Repository |
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World Bank |
language |
English |
topic |
ACCOUNTING BUDGET PROCESS DEDUCTIONS ECONOMIC DEVELOPMENT ECONOMICS EFFECTIVE TAX RATES ENTITLEMENTS EXPENDITURES FEDERAL GOVERNMENT FISCAL FISCAL TRANSPARENCY GOVERNMENT BUDGETS GOVERNMENT EXPENDITURES GOVERNMENT SPENDING INCOME INCOME TAX MINISTERS MINISTRY OF FINANCE POLICY RESEARCH PRESIDENCY PRIVATE SECTOR PRIVATE SECTOR PARTICIPATION PRODUCERS PROVISIONS PUBLIC EXPENDITURE SOCIAL DEVELOPMENT SOCIAL PROGRAMS TAX TAX ADMINISTRATION TAX BASE TAX BENEFITS TAX BRACKETS TAX DEDUCTION TAX EXPENDITURE TAX EXPENDITURES TAX LAWS TAX LIABILITIES TAX PAYMENTS TAX RATE TAX RATES TAX REGIME TAX RETURNS TAX REVENUE TAX REVENUES TAX SYSTEM TAXABLE INCOME TAXATION TAXPAYERS TAX EXPENDITURES BENCHMARKS TAX ADMINISTRATION FISCAL POLICIES POLICYMAKERS TAX EXEMPTIONS ALLOWANCES CREDITS DEFERRALS TAX DEDUCTION CHARITABLE CONTRIBUTIONS UNSKILLED WORKERS GOVERNMENT BUDGETS |
spellingShingle |
ACCOUNTING BUDGET PROCESS DEDUCTIONS ECONOMIC DEVELOPMENT ECONOMICS EFFECTIVE TAX RATES ENTITLEMENTS EXPENDITURES FEDERAL GOVERNMENT FISCAL FISCAL TRANSPARENCY GOVERNMENT BUDGETS GOVERNMENT EXPENDITURES GOVERNMENT SPENDING INCOME INCOME TAX MINISTERS MINISTRY OF FINANCE POLICY RESEARCH PRESIDENCY PRIVATE SECTOR PRIVATE SECTOR PARTICIPATION PRODUCERS PROVISIONS PUBLIC EXPENDITURE SOCIAL DEVELOPMENT SOCIAL PROGRAMS TAX TAX ADMINISTRATION TAX BASE TAX BENEFITS TAX BRACKETS TAX DEDUCTION TAX EXPENDITURE TAX EXPENDITURES TAX LAWS TAX LIABILITIES TAX PAYMENTS TAX RATE TAX RATES TAX REGIME TAX RETURNS TAX REVENUE TAX REVENUES TAX SYSTEM TAXABLE INCOME TAXATION TAXPAYERS TAX EXPENDITURES BENCHMARKS TAX ADMINISTRATION FISCAL POLICIES POLICYMAKERS TAX EXEMPTIONS ALLOWANCES CREDITS DEFERRALS TAX DEDUCTION CHARITABLE CONTRIBUTIONS UNSKILLED WORKERS GOVERNMENT BUDGETS Swift, Zhicheng Li Cavalcanti, Carlos B. Why Worry About Tax Expenditure? |
relation |
PREM Notes; No. 77 |
description |
Tax expenditures are concessions that
fall outside tax norms or benchmarks. These norms include
accounting conventions, the structure of tax rates, the
deductibility of compulsory payments, provisions to
facilitate tax administration, and norms related to
international fiscal obligations. Tax expenditures are
deviations from these norms, implemented to encourage
behavior deemed desirable by policymakers, and can take a
number of forms-including tax exemptions, allowances,
credits, deferrals, and relief (see OECD 1996). The classic
example is a tax deduction for charitable contributions,
where the reduction in tax revenue is more than offset by
the increase in support for charitable activities. Tax
expenditures are not a free lunch, however. They can lead to
inefficiencies and inequities, stimulating no additional
activity and making the tax regime more regressive. For
instance, a tax concession granted to employers who hire
unskilled workers might go to employers who would have hired
such workers anyway. Tax expenditures also affect government
budgets, because they imply forgoing revenue that could be
used to fund direct government expenditures. |
format |
Publications & Research :: Brief |
author |
Swift, Zhicheng Li Cavalcanti, Carlos B. |
author_facet |
Swift, Zhicheng Li Cavalcanti, Carlos B. |
author_sort |
Swift, Zhicheng Li |
title |
Why Worry About Tax Expenditure? |
title_short |
Why Worry About Tax Expenditure? |
title_full |
Why Worry About Tax Expenditure? |
title_fullStr |
Why Worry About Tax Expenditure? |
title_full_unstemmed |
Why Worry About Tax Expenditure? |
title_sort |
why worry about tax expenditure? |
publisher |
World Bank, Washington, DC |
publishDate |
2012 |
url |
http://documents.worldbank.org/curated/en/2003/01/2518855/worry-tax-expenditure http://hdl.handle.net/10986/11327 |
_version_ |
1764416339001212928 |