Draft for Consultation | Voluntary Minimum Standards for Tax Expenditure Reporting

Tax expenditures are costly. Governments worldwide forgo close to a quarter of their tax revenues through tax expenditures. In some countries, the costs of tax expenditures far exceed spending on health or education. While these measures can support investment, economic transformation, and social policies, they are often insufficiently scrutinized. A lack of reliable information on costs, beneficiaries, and impacts makes it difficult for governments to assess whether specific measures are achieving their intended objectives and should be maintained, reformed or completely removed. 

As governments face tight fiscal space, rising debt, and growing demands for investment in development and climate priorities, tax expenditure reform is an important opportunity to strengthen domestic resource mobilization. 

The consultation draft Minimum Standards for Tax Expenditure Reporting: What Are They and Why Are They Important proposes voluntary standards to publish regular, comprehensive, and accessible information on tax expenditures and to ensure that these reports are integrated into national budgets. The standards draw on the Global Tax Expenditures Transparency Index, and on years of experience by COATE partners working on tax expenditure reporting across countries. They seek to set a practical baseline that governments at any level of capacity can adopt. 

COATE invites feedback from governments, international organizations, researchers, civil society organizations, and other stakeholders. Input received will help shape the final set of principles and indicators, which will be published later this year. 

The consultation is open until September 30, 2026. Stakeholders are invited to submit comments to [email protected]. 

COATE looks forward to receiving any comments or feedback stakeholders may have, but these six guiding questions might be useful to structure responses:

1. Background and rationale: In your view, how important is sound tax expenditure reporting as a driver of tax reform? Is your view reflected in the draft proposal? If not, which adjustments would you suggest?
2. Scope and structure: Do you think the proposed four principles and 12 indicators capture the most fundamental aspects of tax expenditure reporting? Are there any missing aspects you think should be included, or aspects you would rather not include? Does the proposed structure (across and within principles) make sense to you?
3. Ambition and impact: Do the four principles and 12 indicators convince you in terms of ambition and impact? Are they sufficiently demanding to trigger impact? Do you think they would be achievable for most countries?
4. Use and implementation: Would you (yourself or your organization) find the voluntary minimum standards for tax expenditure reporting useful for your own work?
5. Monitoring and communications: Would you find it helpful that COATE monitors (and communicates) countries’ progress in achieving the minimum standards?
6. Framing and uptake: Is there anything in the language or positioning of the standards that could make them easier for countries to implement—for instance in how they are framed, sequenced, or connected to ongoing reporting activities?

About COATE 

COATE is a global initiative led by the Council on Economic Policies, German Institute of Development and Sustainability, International Centre for Tax and Development, International Institute for Sustainable Development, and ODI Global. The coalition was launched as part of the Sevilla Platform for Action following the Fourth International Conference on Financing for Development and is endorsed by several governments and organizations.