The use of tax expenditures (TEs) is an important fiscal practice that is often overlooked in public spending debates. The fiscal cost as well as the lack of effectiveness of TEs can be significant. This presentation describes the state of TE reporting across the world, focusing on Africa. It begins by explains what TEs are and what their role in government expenditure is, offers examples of the fiscal cost of these provisions, their (in)effectiveness, and the reasons why they are often hard to remove and the lack and inconsistency of TE reporting. The presentation will also provide the first results of the “Global Tax Expenditures Database” (GTED), an ongoing project aiming to increase transparency and boost research in the TE field. The GTED reveals that over half of African countries do not provide any information on their TEs, while most of the countries that do report on TEs leave out important information such as the policy objectives and beneficiaries of those provisions. The presentation is based on the book chapter “Tax Expenditure Reporting and Domestic Revenue Mobilization in Africa” published in 2021 in: Mosquera Valderrama I.J., Lesage D., Lips W. (eds) Taxation, International Cooperation and the 2030 Sustainable Development Agenda. United Nations University Series on Regionalism, vol 19. Springer, Cham and on the GTED Flagship Report 2021.
Senior Researcher, German Development Institute (DIE)
Christian von Haldenwang is senior researcher at the German Development Institute (DIE) in Bonn. He holds a PhD in political science from the University of Tübingen. Christian’s research focuses on tax policy and reform, discal decentralization and legitimacy. Currently he works on research projects on “Mobilizing domestic revenue”, “Global Tax Expenditures Database (GTED)” and “Transformative urban coalitions”, and he is the DIE regional coordinator for Latin America.