Mapping of Tools and Frameworks to Support Tax System Reform (TSR)

TSR Stages

Medium Term Revenue Strategies (MTRS)

An approach to comprehensive tax system reform - policy, administration, legal framework - recommended by the PCT (IMF, OECD, UN, WB) aiming to increase revenue-to-GDP ratio, improve system design, and enhance its performance and effectiveness. The MTRS approach anchors the TSR to (a) financing additional expenditure needs for growth and development, (b) sustained political commitment to reform formulation and implementation, and (c) coordinated CD support to reform by Development Partners. MTRS encompasses all four TSR stages. 

Diagnostic Tools/Frameworks#1#

TADAT by multiple DPs - to assess tax administration performance from outcome perspective. Secretariat hosted by the IMF.

IMF's RA-GAP - to estimate policy and compliance gaps in VAT, CIT, Excises, PIT (under development).

EC's FBs - to assess tax and customs administrations against EU best practices.

Micro simulation studies by multiple DPs - such as Commitment to Equity (CEQ), to assess distributional impact of fiscal reforms.

IMF/WB's TPAF - to analyze existing tax policies in accordance with good practices.

IMF's FARI - to model, evaluate, compare and design fiscal regimes for extractive industries.

IMF's TEA - to estimate revenue forgone due to tax exemptions and special treatments.

OECD/Global Forum Induction process - to identity current BEPS, transparency and Exchange of Information deficits and challenges, via on-site visits and high-level engagement.

CD missions to TS Diagnostic - an approach used by PCT Partners (and other DPs) to assess strengths and weaknesses of policy and revenue agencies against international trends/good practice.

Data Gathering Tools #2#

ISORA by CIAT/IMF/IOTA/OECD - to collect tax administration data on operations and other characteristics.

USAID's CTD - to collect a brand array of quantitate and qualitative indicators of tax systems.

ATAF's ATO - a paper-based tax administrations survey ATAF conducts with its member countries.

WB's DB - to collect perception indexes in some specific tax policy and administration topics.

Revenue Statistics by multiple DPs - key data on tax (and non-tax) revenues.

ATI indicators - under consideration or alternatively using a subset of ISORA indicators.

ISOCA by IMF/WCO - to collect customs data on operations and other characteristics (to be launched).

Design Approach

CD missions to Comprehensive TSR design - an approach used by the IMF, WB (and other DPs) to advise countries on the design of comprehensive tax system reform - policy, administration, and legal framework. In doing so, several diagnostic and data gathering tools are used, depending on the country's circumstances, to better tailor the advice to countries' capabilities to TSR reform design and implementation.3

CD missions to Targeted TSR design - an approach used by PCT partners (and other DPs) to advise countries on the design of targeted system reform - policy, administration, and/or legal framework - not necessarily in a comprehensive manner; sometimes associated with lending operations or international standard commitments.

OECD/Global Forum Induction process - to identity priorities for reform against international standards on BEPS and Exchange of Information and develop a roadmap and action plan.

Drilldown Tools for Implementation#5#

OECD's Maturity Models - to provide tax administrations with a pathway for improving maturity in specific tax administration processes/areas.

WB's DIAMOND - to conduct drill-down assessments on specific operations and support areas to complement outcome-based tools (e.g. TADAT) to guide implementation CD.

OECD/UN's TIWB - to strengthen skills of tax administration auditors to enhance audit function.

Papers, Toolkits & Technical Notes by multiple DPs - to systematize and disseminate international trends/good practice in policy and administration.

Training by multiple DPs - to strengthen skills of tax administration officials at managerial and operational levels.4 

TFA's CBN - to coordinate CB programs provided by FTA agencies in specific areas of tax administration, under a common approach and coordinating framework.

OECD (and Partners) and Global Forum - to provide support on legislative/ administrative reform organizational change, capacity building and training.

CD program to TSR implementation - an approach used by PCT Partners (and other DPs) to support implementation of reform strategies - comprehensive or topic-specific.

Evaluation/Monitoring Tools/Frameworks

Various of the previous diagnostic and data gathering tools - e.g. TADAT, ISORA.

Targeted assessment of TSR programs by multiple DPs - e.g. IMF's RMTF mid-term evaluation, targeted externally-financed CD projects (DFID, SECO, EC, etc.).

Analytical work by multiple DPs - to assess impact/results of tax policy and administration changes and draw lessons to support previous TRS phases.

Ongoing evaluation of CD Programs to TSR implementation by multiple DPs - e.g. through Result-Based Management systems.

OECD (Inclusive Framework)/Global Forum Peer Reviews - to identify progress made on implementation of international standards and provide recommendations.