Tax Incentives Principles

The Platform for Collaboration on Tax (PCT), a joint initiative of the International Monetary Fund, the OECD, the United Nations, and the World Bank Group, has issued draft Tax Incentives Principles for public consultation.

Tax incentives—various forms of preferential tax treatment—have been widely used by countries to encourage desired activities and behaviours. However, while tax incentives can be effective in promoting specific goals, they can also erode tax revenue, create unintended distortionary and distributive consequences, and pose governance challenges. Policy makers, therefore, face complex decisions, especially in light of ongoing and fundamental changes in the international tax landscape.

To maximize the usefulness of the principles and remarks, responses to the following questions are sought:

1. Do you find the principles and remarks presented in the document appropriate and well-balanced in terms of content and coverage? If so, please explain why. If not, please provide any suggestions you may have for refining the document.
2. The document references additional material to help apply the principles. Given this, are there areas where you feel more guidance is needed?
3. What kind of support might countries require to effectively apply the principles?
4. Do you have any recommendations to refine the principles and remarks, given your experiences with tax incentives (either positive or negative)? 
5. Do you have any other comments or suggestions?

Please answer as many questions as you find appropriate. In your submission, kindly include the name of your organization, department, as well as the contact person’s name along with their contact details.  Please send your responses to taxcollaborationplatform@worldbank.org, with a copy to arajca@worldbank.org.  The deadline for submission is February 11th, 2025.

Kindly note that all responses will be publicly posted on the PCT website.

Kindly note that all responses will be publicly posted on the PCT website.

The Platform for Collaboration on Tax (PCT) is a joint initiative of the International Monetary Fund (IMF), Organisation for Economic Co-operation and Development (OECD), United Nations, and the World Bank Group to strengthen collaboration on domestic resource mobilisation (DRM). The PCT, launched in April 2016, fosters collective action for stronger tax systems in developing and emerging countries.

Learn more: https://www.tax-platform.org/