The Global Tax Expenditures Database (GTED), a joint project of the Council on Economic Policies (CEP) and the German Development Institute / Deutsches Institut für Entwicklungspolitik (DIE), now features 100 countries with tax expenditure data. The latest addition to the GTED was Mongolia, which recently released 4 tax expenditure reports covering the 8 years from 2013.
While the increase to 100 countries marks an important milestone, it is important to note the flip side that 118 jurisdictions worldwide remain confirmed as non-reporting, i.e., they have not released any tax expenditure data since 1990.
Agustin Redonda, CEP Senior Fellow, highlights that “estimating and reporting on tax expenditures is a crucial first step towards better design of tax expenditure systems. At the same time, it can also be a resource-intensive exercise with a steep learning curve. We are delighted to see new countries starting to report on tax expenditures. We also encourage Mongolia and other countries where tax expenditure reporting is at its infancy, to keep improving their reports by, for instance, progressively increasing the number of reported provisions, providing tax expenditure-level data, and ensuring that crucial information such as the policy goal each provision pursues is clearly discussed. Moving in this direction will not only strengthen transparency and accountability, but also make a substantial contribution towards evidence-based policy making in the field.”
Christian von Haldenwang from DIE observes: “We expect more countries to publish tax expenditure reports in the future. As the GTED shows, governments forgo huge amounts of revenue by granting tax incentives, tax exemptions, reduced tax rates, etc. to businesses and private households – on average, 25 per cent of actual tax revenue! At a time when governments all over the world are looking for resources to fund pandemic recovery measures or climate change policies , transparency on tax expenditures is a core element of any meaningful debate on how to make tax systems fit for the future.”
The GTED is the first global database that brings together official and publicly available data on tax expenditures, as published by national governments since 1990, and makes it available free of charge online. The GTED was built by CEP and DIE in a multi-year engagement to increase transparency and enhance scrutiny of tax expenditures and the critical role they play in tax systems around the world. It is updated on an ongoing basis.
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