Tax incentives are embedded in many national investment laws, but there is little research on how these incentives are governed, which institutions decide on their design and implementation, and who monitors whether they deliver.
In the new IISD report Tax Incentives in National Investment Laws, expert Josefina del Rosario Lago analyzed 100+ investment laws across Africa, Asia and Latin America and interviewed government officials to find out. Here is what the data shows:
- Incentives frequently operate through overlapping legal regimes, allowing investors to accumulate benefits across frameworks with no unified oversight.
- Investment promotion agencies typically lead on approval and administration, while Ministries of Finance remain at the margins.
- Monitoring frameworks are often weak or absent, making it hard to assess whether incentives generate growth, jobs, or broader social returns.
- Centralization efforts are underway in some countries, but progress remains uneven.
Tax incentives represent billions in foregone public revenue. As emerging market and developing economies face constrained fiscal space, stronger coordination between key institutions, monitoring and accountability are essential to ensure public value.
Josefina del Rosario Lago is a policy analyst in IISD’s Economic Law and Policy Program, working at the intersection of the tax and investment teams. She develops research and practical guidance for governments and delivers technical assistance programs on these issues. Before joining IISD, Josefina interned at the World Bank Group, focusing on international law and development across Latin America, the Caribbean, and Europe. She also served as legal counsel at Argentina’s Office of the Treasury Attorney General, assisting in the defense of the Argentine Republic in investor–state dispute settlement proceedings and sovereign debt disputes and contributing to international economic agreements, as well as World Trade Organization and United Nations Commission on International Trade Law negotiations.