public financial management (pfmx) module 6 · tax revenue analysis public financial management ......
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Module
Tax Revenue Analysis
Public Financial Management (PFMx)6
Taxation and the Budget Cycle
LegalFramework
FiscalFramework
#1
BudgetPreparation
#2ControlandAudit
#5
AccountingandReporting
#4Budget
Execution
#3
Revenueforecasting
Accountability
TaxPolicy
Revenuecollection
“In this world, nothing can be said to be certain except death and taxes.”– Benjamin Franklin (1789)
The Importance of Tax Revenue
OTHER
71 %
29%
01020304050607080
Taxandotherrevenue:average2014-2016
Source:IMFWoRLD
TaxRevenue OtherRevenue
Non-Tax Revenues
Ø Grants
Ø Natural Resources
Ø State-Owned Enterprises
Ø Central Banks
OTHER
TaxRevenue OtherRevenue
44%
29%
21%
6%Taxrevenue
Grants
OilRevenue
Other
90%
10%
Belgium
Taxrevenuein2016(%totalrevenue)
Chad
Illustrating Cross-Country Differences
Source:IMFWoRLD
Tax Revenue Over Time
60
65
70
75
80
85
90
2000 2002 2004 2006 2008 2010 2012 2014 2016
Developingeconomies EmergingmarketsAdvancedeconomies
Mediantaxrevenue:2000-2016(%totalrevenue)
Source:IMFWEO
Tax Revenue Comparison
0
50
100
150
200
250
300
350
400
450
2010 2011 2012 2013 2014 201535
37
39
41
43
45
47
49
51
53
55Greece Turkey
TaxRevenue:GreeceandTurkey2010-2015(InBillionslocalcurrency,Greeceplottedonsecondaryaxis)
Source:IMFWEO
Tax-to-GDP Comparison
15
17
19
21
23
25
27
2010 2011 2012 2013 2014 2015
Greece Turkey
TaxRevenue:GreeceandTurkey2010-2015(%GDP)
Source:IMFWEO
Tax Ratio Averages
15%18%
22%
0
5
10
15
20
25
Developingeconomies
Emergingmarkets Advancedeconomies
Averagetaxrevenuein2016(%GDP)
Source:IMFWEO
Disparity in Tax Revenue (advanced economies)
0.6% 2%
Average22%
40%
47%
05
101520253035404550
Bahrain SaudiArabia AdvancedEconomies
Denmark Sweden
Taxratio(average2014-2016)
Source:IMFWEO
Disparity in Tax Revenue (developing economies)
6%9% Average15%
20% 20%
42%
05
1015202530354045
Nigeria Bangladesh DevelopingEconomies
Uzbekistan Senegal Lesotho
Source:IMFWEO
Taxratio(average2014-2016)
Trend in Tax Ratio
0
5
10
15
20
25
19901992199419961998200020022004200620082010201220142016
Developingeconomies Emergingmarkets
Advancedeconomies
Averagetaxrevenuebyincomegroup:1990-2016
Source:IMFWEO
Tax Mix Comparison
10%
30%
44%
1% 15%
CorporateIncomeTax
PersonalIncomeTax
DomesticConsumptionTaxesTaxesonInternationalTradeOtherTaxes
16%
14%
51%
11%
8%
Advanced Economies Developing Economies
Averagetaxmix:2013-2015 (%taxrevenue)
Sources:IMFWoRLD
0
2
4
6
8
10
12
14
16
18
100 300 500 700 900 1100 1300 1500
Effe
ctiv
e ta
x ra
te (%
)
Gross Income ($)
Progressive tax
Proportional flat tax
RichPoor
0
2
4
6
8
10
12
14
16
18
100 200 300 400 500 600 700 800 900 100011001200130014001500
Effe
ctiv
e ta
x ra
te (%
)
Gross Income ($)
Progressive tax
BoomCrisis
MinistryofFinance/Treasury
OtherMinistries
TaxAdministration
PrivateSector
SettingtheTaxPolicyReformAgenda