Perspectives from the ATI partner countries Ghana, Malawi and the Philippines on designing tax incentives

The recent publication “Perspectives from ATI partner countries on the design of tax incentive regimes” by the ATI Consultative Group 3 presents examples of the tax incentive design process in three ATI partner countries: Ghana, Malawi and the Philippines. By highlighting the key similarities and differences, the publication provides insights on good practices and challenges of tax incentive regimes in ATI partner countries. The paper was published by International Tax Compact (ITC) and funded by the German Federal Ministry for Economic Cooperation and Development (BMZ).

The tax incentives design process is assessed against the following design features: clear goals, clear eligibility criteria, clear choice of tax instrument, cost-benefit analysis, transparency, consistent monitoring and evaluation, no discretionary powers during the process of granting incentives, public participation, and parliamentary approval of the incentive. The information in the brief is based on questionnaires and interviews conducted with representatives from the ministries of finance of the respective partner countries.

The publication identifies clear objectives and defined eligibility criteria for the granting of tax incentives, as well as the inclusion of the public in the design process, as commonalities between the three jurisdictions. A common challenge faced by all countries interviewed is the availability and collection of data both for cost-benefit analyses and for monitoring and evaluation purposes. Based on existing processes and challenges, these commonalities can be used as a basis for increased collaboration between partner countries in the area of tax incentives in order to improve their design process and effectiveness.

To access the full publication, please click here.