Tax Reform in Brazil: The Long Process in Progress
A tax reform process is now in course in Brazil. It started in 1995, when the President of the Republic presented to the National Congress a proposal to amend the chapter on the tax system of the Brazilian Federal Constitution (PEC 175/95). During the more than seven years of stop-and-go discussion, the process provided only two practical results: the so-called Kandir Law that modified the chief state tax ? on the circulation of merchandises and on communication and interstate and intermunicipal transportation services (ICMS) ?, but which effects have been partially postponed by subsequent laws; and a recent law, which has mitigated the cascading of a social contribution. 1 Discussion of the constitutional amendment, which was interrupted in the first quarter of 2000, is expected to resume in 2003. This paper discusses the tax reform process in course.
The Political Economy of Domestic Tax Reform in Bangladesh: Political Settlements, Informal Institutions and the Negotiation of Reform
ABSTRACT This paper explains the persistence of a tax system characterised by low revenue collection and extensive informality in Bangladesh. It combines analysis of long-term formal and informal institutions and of micro-level incentives shaping negotiation of short-term reform. The system is unusually informal, discretionary, and corrupt, but remains resistant to change because it delivers low and predictable tax rates to business, extensive opportunities for corruption to the tax administration, and an important vehicle for fundraising by political leaders and rent distribution to their elite supporters. We then explore the dynamics of micro-level reform and external pressure within the constraints of this overarching political bargain.
Bank Debit Taxes in Latin America: An Analysis of Recent Trends
Six Latin American countries have levied taxes on withdrawals from bank accounts, which have been viewed as a convenient tax handle during a difficult fiscal period. The paper reviews the arguments for and against this type of taxation, describes the taxes, and surveys their revenue performance and economic impact. It concludes that the recently implemented taxes have been successful in raising revenue in the short term, but that adverse allocational impacts have likely been significant. The tax may work better in times of fiscal crisis, when financial intermediation is deep, and when the tax rate is modest.