Search for other papers by International Monetary Fund in
Current site
Google Scholar
Abstract
This chapter analyses the administrative challenges presented by different resource tax instruments. It concludes that all tax bases commonly used for resource taxation present significant administrative challenges. Progressive profit-based taxes1 can present greater challenges than others. Importantly, however, the capacity required to meet those challenges in a well-designed progressive profit-based resource tax regime can be quite limited, and is often exaggerated. Certainly the potential difficulties need not rule out adoption by a developing country with poor administrative capacity if, as is often the case, the country’s resource industry is concentrated in the hands of a relatively small number of large companies. In any case, the apparent simplicity of alternatives to such regimes is often, in practice, deceptive.
International Monetary Fund Copyright © 2010-2021. All Rights Reserved.