The Platform for Collaboration on Tax (PCT) – a joint initiative of the IMF, OECD, UN and the World Bank – enhanced its support to countries in the area of domestic resource mobilization during the COVID-19 pandemic, according to the PCT Progress Report 2021. The report highlights that the PCT Partners are committed to deepening their tax collaboration further with a revamped work program to help countries develop resilient tax systems and better fiscal policies in response to the crisis.
On the topic of tax expenditures they announced a plan to “conduct a pilot study on tax expenditures under PIT, CIT, VAT systems that undermine carbon taxes (e.g., VAT exemptions on kerosene, deductions on fuel or transport allowance paid to employees) in order to raise awareness
about the counteractive effects of such expenditures on mitigation efforts, and to produce a scoping note for possible joint work on benchmarking environmental taxes vis-a-vis conventional taxes in respect of fiscal and social objectives (e.g., robustness against informality, evasion, fiscal multiplier effects, equity).”
You can read the full report here.