The temporary increase of interest income tax in the 2019 budget could also be made permanent. Further raising revenue reliably and rapidly will require measures based on existing tax collection infrastructure, such as the VAT and fuel excises. Significant further revenue could also be raised by broadening the VAT base through the removal of exemptions on items such as foreign-registered yachts, diesel used for electricity generation, and road vehicles. The authorities should also improve tax administration, which could deliver meaningful additional revenue, including from those who currently evade taxes. Better tax collection will, however, require concrete action. Requiring businesses to only use financial statements certified by the Ministry of Finance (as part of their tax return filing process) to obtain loans from banks, is one such option. Successful improvement in the collection of existing taxes may reduce the need to increase tax rates.
Source: IMF
