ISSUES IN TAX REFORMS

TL;DRAbstract

This paper seeks to describe the principles that have guided recent tax reforms in Asian developing countries. It critically examines the purported rationale underlying these reforms and raises some issues connected with these reforms. The paper first discusses the new direction of the perceived role of taxation as a macroeconomic tool and the principles which have formed the basis of recent tax reforms. It then analyses the implications of the application of these principles for the level and structure of taxes. It concludes with a summary of the key issues raised in the paper. Developing countries implemented an array of major economic reforms during the 1980s and the 1990s. Tax reforms formed an integral part of these reforms. The impetus for tax reforms was provided by a number of domestic and external factors (ADB, 1993). The last two decades were marked by a fundamental reassessment in developing countries of the role of the Government in economic development. There was a discern

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