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Mr. Paolo Dudine and João Tovar Jalles

(SSC); analyzing the influence of business cycle’s turning points on tax buoyancy, with a particular focus on the Global Financial Crisis (GFC); assessing which macro and structural characteristics matter more to explain crosscountry differences in tax buoyancy estimates. Our results suggest that: Long-run revenue buoyancy is not different from one. This implies that revenues ensure long-run sustainability only if permanent increases in spending deliver at least the same increase in long-run GDP. Short-run revenue buoyancy is not different from one in

Mr. Paolo Dudine and João Tovar Jalles
In this paper we provide short- and long-run tax buoyancy estimates for 107 countries (distributed between advanced, emerging and low-income) for the period 1980–2014. By means of Fully-Modified OLS and (Pooled) Mean Group estimators, we find that: i) for advanced economies both long-run and short-run buoyancies are not different from one; ii) long run tax buoyancy exceeds one in the case of CIT for advanced economies, PIT and SSC in emerging markets, and TGS for low income countries, iii) in advanced countries (emerging market economies) CIT (CIT and TGS) buoyancy is larger during contractions than during times of economic expansions; iv) both trade openness and human capital increase buoyancy while inflation and output volatility decrease it.
Vincent Belinga, Ms. Dora Benedek, Ruud A. de Mooij, and Mr. John Norregaard
By how much will faster economic growth boost government revenue? This paper estimates short- and long-run tax buoyancy in OECD countries between 1965 and 2012. We find that, for aggregate tax revenues, short-run tax buoyancy does not significantly differ from one in the majority of countries; yet, it has increased since the late 1980s so that tax systems have generally become better automatic stabilizers. Long-run buoyancy exceeds one in about half of the OECD countries, implying that GDP growth has helped improve structural fiscal deficit ratios. Corporate taxes are by far the most buoyant, while excises and property taxes are the least buoyant. For personal income taxes and social contributions, short- and long-run buoyancies have declined since the late 1980s and have, on average, become lower than one.
Vincent Belinga, Ms. Dora Benedek, Ruud A. de Mooij, and Mr. John Norregaard

.96. Interestingly, short-run buoyancy of the SSC is significantly smaller than one. 4 One reason for this might be their regressive structure (due to caps on the income subject to SSC). Short-run buoyancy of the property tax is the only that is not significantly different from zero. Municipalities might keep revenue from this source stable, irrespective of what happens to GDP. The speed of adjustment for the property tax is also the lowest of all taxes, i.e., adjustment towards its long-term buoyancy is slow. Table 4 shows buoyancy estimates over the two periods distinguished

Mr. Paolo Dudine and João Tovar Jalles
Vincent Belinga, Ms. Dora Benedek, Ruud A. de Mooij, and Mr. John Norregaard
International Monetary Fund. African Dept.

Senegal in Context D. The way forward: concluding remarks and policy consideratons BOXES 1. Buoyancy FIGURES 1. Inter-Quantile Range of Tax Revenue (Percent of GDP) Over Time 2. Histogram of Country Specific Buoyancy Estimates for PIT, CIT, and TGS (Relative Frequency, Percent) 3. Tax Revenue 4. Non-Tax Revenue 5. Revenue from International Trade 6. Revenue from Sales Taxes 7. Revenue from PIT 8. Revenue from CIT 9. Revenue from Social Contributions 10. Revenue from Property Taxes TABLES 1. Overall Tax Buoyancy by Country

International Monetary Fund. African Dept.

revenue for each country in our sample . Note first that the standard deviation of long-run buoyancy estimates is much larger than the one for the short run. Moreover, in 19 out of 37 countries 5 long-run tax buoyancies are statistically significantly higher than one, meaning that for these countries growth has improved fiscal sustainability over time. 6 For the rest of the countries, almost all yielded a long-run buoyancy statistically not different from unity. In only 11 out of 37 countries 7 the tax system has acted as a good automatic stabilizer, as evidenced by

Mr. Nurun N. Choudhry

discretionary tax measures on revenue are estimated by an index that isolates the automatic growth of revenue from the total growth. Second, the buoyancy of tax revenue is estimated, with respect to gross domestic product (GDP) or any other aggregate income variable, by a standard regression technique. Finally the buoyancy estimate obtained in the second step is adjusted by a suitable transformation of the index of discretionary revenue, as estimated in the first step, in order to provide an estimate of the elasticity of tax yield. The proposed method of measuring the

International Monetary Fund. African Dept.
This Selected Issues paper offers policy recommendations for Senegal to reach high and sustained growth with the goal of exiting low-income country status. For Senegal to reach Plan Sénégal Emergent (PSE) objectives, reforms under the PSE need to create space for small and medium-sized enterprises and foreign direct investment to thrive. Reform of Senegal’s business environment needs to be accelerated. Macrostructural reforms should be stepped up in the energy sector, in which Senegal still ranks 170th in the world. Progress in the electricity sector can be achieved by continuing to improve reliability of supply and reduce electricity costs. Reform of the taxation system, by simplifying procedures and optimizing the tax rates, is another macro-critical area in which Senegal needs to make significant strides.