Honduras: Selected Issues

July 19, 2019

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Format: Chicago

Honduras: Selected Issues, (USA: International Monetary Fund, 2019) accessed November 21, 2024

Summary

This Selected Issues paper looks at revenue mobilization efforts in Honduras. The country has made considerable progress over the last years, helping to stabilize its fiscal position. Although tax revenue collection ratios in Honduras are high, the statutory rates are aligned with regional peers. A formal benchmarking exercise supports the evidence pointing to Honduras’s relatively good collection performance. The authorities’ future revenue mobilization strategy should prioritize reforms aiming at increasing efficiency and compliance. The cost-benefit assessment of existing tax exemptions in terms of their policy objectives may offer guiding principles to prioritize reforms going forward. Compared to peers, statutory tax rates are similar and tax collection ratios are generally higher—a benchmarking exercise suggests that the current revenue envelope is close to its frontier. Going forward, there is a need to sustain revenue mobilization efforts, which will be instrumental to maintaining a sound fiscal position, reducing the infrastructure gap, and increasing social spending. Rationalizing large tax expenditures could contribute to these efforts.

Subject: Commodities, Electricity, Exchange rate flexibility, Exports, Fiscal policy, Foreign exchange, International trade, Revenue administration, Revenue mobilization

Keywords: Asia and Pacific, CAPDR, Collection ratio, Cost, Cost-recovery tariff, CR, Distribution loss, Electricity, Exchange rate flexibility, Export, Exports, Generation company, ISCR, Reform package, Revenue mobilization, Revenue mobilization effort, Sector reform, South America, Tax collection collection ratio

Publication Details

Pages:

14
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2019/237
Stock No:

1HNDEA2019002
ISBN:

9781513507859
ISSN:

1934-7685

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