Morocco's Progress in Global Tax Expenditure Transparency

In a recent update to the Global Tax Expenditure Transparency Index, Morocco has climbed to the 33rd position out of 116 countries, achieving a score of 57.2 out of 100. This marks a notable improvement of 1.5 points from its previous ranking. The index, released by the Economic Policy Council (CEP) and the German Institute for Development and Sustainability (IDOS), evaluates countries based on the transparency and quality of their tax expenditure reporting.

Leading the index is Indonesia, which scored an impressive 79.9 points, followed by South Korea and Australia in the second and third positions, respectively. Conversely, Bhutan ranked last at 116th place with a dismal score of only 12.5 points. Algeria finds itself near the bottom as well, slipping 11 spots to 115th place with a score of 21 points.

Understanding the Implications of Tax Expenditures

The report emphasizes that governments worldwide utilize tax expenditures to achieve various political objectives, such as attracting investment, promoting innovation, and alleviating inequality. However, these tax expenditures come at a significant cost; globally, they have averaged 3.7% of GDP and 23% of total tax revenues from 1990 to 2023. Poorly designed tax expenditures can lead to negative side effects, and the lack of transparency in this area is alarming. Since 1990, only 116 countries and regions out of 218 have reported their tax expenditures at least once.

The index assesses countries based on several criteria, including the accessibility of tax expenditure reports to the public, the timeliness and regularity of the data, the contribution of the state's institutional framework to enhancing transparency and accountability in tax expenditure policies, and the comprehensiveness of the reports concerning all applicable national tax expenditures. Moreover, it highlights the importance of these reports in clearly identifying and measuring the revenue losses resulting from tax provisions, which should include estimates for at least one type of tax and one fiscal year.

As reported by hespress.com.