31 July 2026 – The Coalition on Tax Expenditure Reform (COATE) launches a public consultation on new voluntary minimum standards to improve worldwide reporting on tax expenditures, such as exemptions, deductions, credits, and reduced rates.
Tax expenditures are costly. Governments worldwide forgo close to a quarter of their tax revenues through tax expenditures. In some countries, the costs of tax expenditures far exceeds spending on health or education. While these measures can support investment, economic transformation, and social policies, they are often insufficiently scrutinized. A lack of reliable information on costs, beneficiaries, and impacts makes it difficult for governments to assess whether specific measures are achieving their intended objectives and should be maintained, reformed or completely removed.
“More and better information on tax expenditures is necessary although not sufficient for successful tax expenditure reforms to take place“, said Agustin Redonda, Senior Fellow with CEP and co-director of the Tax Expenditures Lab. “Reliable tax expenditure reporting is essential to understanding the fiscal cost of tax expenditures. In the end, it is a key driver of evidence-based policy making in the field.”
As governments face tight fiscal space, rising debt, and growing demands for investment in development and climate priorities, tax expenditure reform is an important opportunity to strengthen domestic resource mobilization.
The consultation draft “Minimum Standards for Tax Expenditure Reporting: What are they and why are they important” proposes voluntary standards to publish regular, comprehensive, and accessible information on tax expenditures and also ensure that these reports are integrated into national budgets. The standards draw on the Global Tax Expenditures Transparency Index (GTETI) and on years of experience by COATE partners working on tax expenditure reporting across countries. They seek to set a practical baseline that governments at any level of capacity can adopt. As Christian von Haldenwang, Senior Researcher with IDOS and the other co-director of the Lab, puts it: “We propose a set of principles and indicators based on a simple question: What do policy-makers and other stakeholders need to know to make informed decisions on the use of tax expenditures?”
COATE invites feedback from governments, international organizations, researchers, civil society organizations, and other stakeholders. Input received will help shape the final set of principles and indicators, which will be published later this year.
About the Coalition on Tax Expenditure Reform
COATE is a global initiative led by the Council on Economic Policies (CEP), the German Institute of Development and Sustainability (IDOS), the International Centre for Tax and Development (ICTD), International Institute for Sustainable Development (IISD) and ODI Global. The Coalition was launched as part of the Sevilla Platform for Action following the Fourth International Conference on Financing for Development and is endorsed by several governments and organizations.
The consultation is open until September 30 2026.
COATE looks forward to receiving any comments or feedback stakeholders may have, but these 4 guiding questions might be useful to structure responses:
- Q1. Background & Rationale: In your view, how important is sound tax expenditure reporting as a driver of tax expenditure reform? Is your view reflected in the draft proposal? If not, which adjustments would you suggest?
- Q2. Scope & Structure: Do you think that the proposed 4 principles and 12 indicators capture the most important aspects of tax expenditure reporting? Are there any missing aspects you think should be included, or aspects you would rather not include? Does the proposed structure (across and within principles) make sense to you?
- Q3. Ambition & Impact: Do the 4 principles and 12 indicators convince you in terms of ambition and impact? Are they sufficiently demanding to trigger impact? Do you think they would be achievable for most countries?
- Q4. Use & Implementation: Would you (yourself or your organization) find the voluntary minimum standards for tax expenditure reporting useful for your own work?
- Q5. Monitoring & Comms: Would you find it helpful that COATE monitors (and communicates) countries’ progress in achieving the minimum standards?
Stakeholders are invited to submit comments to [email protected]