ИПИ Библиотека

Tax Reform in Developing Countries carefully examines the experience of eight developing countries that have undergone -- and in some instances are still undergoing -- significant and comprehensive tax reform. The countries are Bolivia, Colombia, Indonesia, Jamaica, Korea, Mexico, Morocco, and Turkey. It draws on their experiences to find lessons learned and to see how they may be applied to other countries on the road to tax reform. Equal attention is given to the process of tax reform, how it is implemented, and the substance or results of reform efforts. Throughout, the focus is on the practical rather than the theoretical aspects of tax reform.

The eight case-study countries in this report--Bolivia, Colombia, Indonesia, Jamaica, Korea, Mexico, Morocco, Turkey--provide a laboratory for studying tax reform in practice. The countries vary not only in per capita income but also in the context within which tax reform takes place. They undertook different types of reform and the outcome differed. Several lessons emerge: 1) Although all countries are often forced to sacrifice the optimal tax structure in favor of a simpler, more uniform system, to conform to the administrative capacity of the country, the sacrifices can be especially large in developing countries. 2) Developing country tax systems need not be overly concerned with equity, since redistribution in these countries is best carried out by public expenditures. 3) Instances where obviously welfare-improving, even Pareto-improving, tax reforms are not undertaken illustrate the point that even reforms benefiting everyone may be opposed by the affected parties who perceive their bargaining power altered (and possibly reduced) in the longer run.

Wayne Thirsk

Wayne Thirsk, Visiting Research Professor of Economics, International Studies Program, Ph.D., Yale University.

Wayne Thirsk has been a visiting research professor with ISP since July 2006. Dr. Thirsk is a public finance economist with extensive practical and academic experience; he has worked in 23 developing countries on a wide variety of public finance issues.

Prior to his stay with the Andrew Young School, Dr. Thirsk was a tax policy advisor to the Zambia Ministry of Finance. From 1996-2002, he worked as an intergovernmental fiscal advisor with the USAID fiscal reform project in Ukraine, working closely with officials of the Department of Finance and members of the Ukrainian Parliament to draft legislation for a new Budget Code. Thirsk spent 1996 in Egypt as Director of the USAID funded corporate tax reform project and produced a blueprint for needed reform in this area. Dr. Thirsk previously worked as the chief of party for the USAID fiscal reform project in the former Soviet Republic of Kyrgyzstan, where he successfully supervised the activities of four expatriate policy advisors and a local staff of five assistants and established a close and effective working relationship with budgetary officials in the Ministry of Finance and tax officers working in the State Tax Administration.