IMF Working Papers

Taxation in Latin America: Structural Trends and Impact of Administration

Author/Editor:

Parthasarathi Shome

Publication Date:

February 1, 1999

Electronic Access:

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Summary:

From the mid-1980s to early 1990s, Latin American tax policy provided rich lessons for other reforming countries. Meaningful innovations led also to perceptible revenue gains. Later in the 1990s, tax policies began to drift. Shining examples of fundamental reform seemed to lose their luster. Revenue in terms of GDP also stagnated, partly reflecting over-reliance on consumption taxes and neglect of taxable capacity on incomes. The stagnation has been exacerbated by excessively simplified administrative practices. Based on these developments and on the limited taxability of internationally mobile capital, the paper anticipates a likely tax structure for the new century.

Series:

Working Paper No. 1999/019

Subject:

Corporate income tax Income and capital gains taxes Income tax systems Personal income tax Revenue administration Tax administration core functions Taxes