TaxCorporate TaxTax systems encourage credit boom, says IMF

Tax systems encourage credit boom, says IMF

Global tax administrations have fuelled excessive borrowing, and according to the IMF, this needs to change

The International Monetary Fund (IMF) has recommended countries amend tax
policies in an attempt to discourage borrowing with debt rather than equity.

This systemic approach taken by tax administrations around the world has
contributed to the unsustainable credit boom, according to
ft.com

Michael Keen, assistant director of tax policy at the IMF’s fiscal affairs
department, said while this is not to blame for the global financial crisis, ‘we
do see some tax fingerprints at the scene of the crime.’

The IMF has recommended governments amend tax policies through the
elimination of the deductibility of interest payments, or adopt a deductibility
for the notional cost of equity financing.

Further Reading:

Tax
systems must be open and transparent, says ACCA

Tax
loss policy hits long-term investment

Related Articles

Markets expected to respond positively to US policy changes

Corporate Tax Markets expected to respond positively to US policy changes

7m Alia Shoaib, Reporter
Banks’ £135m tax avoidance scheme shutdown by authorities

Corporate Tax Banks’ £135m tax avoidance scheme shutdown by authorities

2y Fraser Simpson, Reporter
HMRC protects £45m in second Abbey National avoidance case

Corporate Tax HMRC protects £45m in second Abbey National avoidance case

2y Calum Fuller, Reporter
#AS2014: Banks hit with £3.5bn rap on knuckles

Corporate Governance #AS2014: Banks hit with £3.5bn rap on knuckles

3y Chris Warmoll, Writer
UK’s banks pay 71% of profits in tax

Corporate Tax UK’s banks pay 71% of profits in tax

4y Calum Fuller, Reporter
Tax naming and shaming could be extended to banks under HMRC plans

Corporate Tax Tax naming and shaming could be extended to banks under HMRC plans

5y Calum Fuller, Reporter
Colin: Lifeline for Tobin?

Corporate Tax Colin: Lifeline for Tobin?

5y Taking Stock
Barclays’ tax avoidance division generated £1bn annually

Corporate Tax Barclays’ tax avoidance division generated £1bn annually

5y Calum Fuller, Reporter