In this toolkit, the World Bank Group and donor partners provide a number of options for reforming the tax system in developing countries to facilitate small business compliance. While it does include some tax administration reform options, its focus is on tax policy.
Small businesses are a unique phenomenon for the tax system—they form the bulk of taxpayers, and yet they are also the major contributors to the informal economy operating outside the tax system.
Operating in the informal economy hurts the economy as a whole, especially the compliant part of the business community. It also affects the growth potential of informal businesses. Reforms to foster private sector development and to support innovation and growth, therefore, need to address and eliminate obstacles to getting small businesses into the formal sector. In most countries, a cumbersome tax system is considered one of the main reasons for operating in the informal economy.
Download the toolkit... (PDF, 1.3MB).
Published February 14, 2008
