Cover Tax Law Technical Note
Designing Interest and Tax Penalty Regimes
Author:
Mr. Christophe J Waerzeggers
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,
Mr. Cory Hillier
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Mr. Irving Aw
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Series:
Tax Law Technical Note
Volume/Issue:
Volume 2019: Issue 001
Language:
English
Publication Date:
18 Mar 2019
DOI:
https://doi.org/10.5089/9781498302012.008
ISBN:
9781498302012
ISSN:
2523-5753
Pages:
20
Keywords:
TLT; tax authority; penalty regime; tax authorities; law framework; RegimesDesigning interest; tax administration; ability to pay; tax official; taxpayer compliance; incentive regime; tax authority exercise; Tax administration core functions; Interest payments; Legal support in revenue administration; Tax law; Interest tax; Africa
Legal-disclaimer:
This Tax Law Note should not be reported as representing the views of the IMF. The views expressed in this Tax Law Note are those of the authors and do not necessarily represent those of the IMF or IMF policy.
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Nearly all tax systems have some form of interest and tax penalty regimes. Interest payable on any late or underpayment of tax seeks to protect the present value of the tax amount to the government budget, whereas penalties are intended to deter taxpayers from defaulting on their tax obligations—and to punish them if they do—to achieve horizontal equity vis-à-vis compliant taxpayers. As interest and penalties serve very different objectives, they should not be applied in a mutually exclusive manner. This Tax Law IMF Technical Note focuses on the key issues that should be taken into consideration in designing interest and penalty regimes in tax legislations.
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Cover Tax Law Technical Note
Tax Law Technical Note
ISSN:
2523-5753
Publisher:
International Monetary Fund
Volume 2019: Issue 001