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Cut consumption taxes, and review VAT – IMF advises Mozambique
8:30 CAT | 18 Jan 2016
In file Club of Mozambique.
The International Monetary Fund believes that Mozambique should undertake a comprehensive “review and rationalization” of VAT, as well as reducing taxes on consumption and broadening the tax base, to improve tax efficiency.
The IMF report on Mozambique says that “reducing taxes on consumption, extending the tax base and improving efficiency in collection to avoid loss of revenue” are initiatives that can best reduce inequality in Mozambique,
In the document, which analyses the influence of fiscal policy on inequality in Mozambique, IMF experts argue that “exemptions and zero VAT rates have an undefined impact on the poorest and shrink the tax base”, and stress that “VAT efficiency in Mozambique is well below the average for countries of the Southern African Development Community”.
Source: Dinheiro Digital / Lusa
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