'Tax reforms beneficial for firms and governments'

News Article - 21 May 2012
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Governments and businesses can benefit from eliminating or simplifying business taxes, according to a new report.

The Paying Taxes 2008 report by PricewaterhouseCoopers, IFC and the World Bank claimed that reducing corporate income tax and other reforms have improved 31 economies so far this year and 65 over the last three years.

Bulgaria reportedly has the top reforms, followed by Turkey. Compliance burdens were found to be highest in Latin American, eastern European and central Asian countries.

"Despite previous reluctance to reduce tax burdens for fear of cutting government revenues, some governments that have implemented tax reform have reaped the benefit of higher investment and economic growth," said Rita Ramalho, co-author of the report and tax specialist with the World Bank-IFC Doing Business project.

Countries where there are lower tax burdens attract more new business, she added.

In related news, Mercer's Worldwide Individual Tax Comparator Report rated the UK as the 14th most attractive tax environment out of 32 nations.

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