According to a new report from the OECD increasing tax revenues and ensuring sustainable domestic resource mobilisation will be critical as emerging Asian economies seek to boost the provision of public goods and services and improve economic growth and living standards.
It’s a good common sense idea in theory but perhaps more challenging to apply on the ground.
Trends in Indonesia, Malaysia and the Philippines shows that the tax-to-GDP ratio has grown steadily since 2000 in all three countries, but has remained relatively stable in recent years.
In 2013, Indonesia had a tax-to-GDP ratio of 13.1%, which was slightly lower than the 16.2% reported in the Philippines and the 16.9% reported in Malaysia. The three countries’ tax levels were significantly below those of OECD countries in the region such as Korea, where the tax-to-GDP ratio was 24.3%, or Japan, where it was 29.5%, and well below the OECD average of 34.1%.
The OECD report shows that the tax-to-GDP ratios in the three countries have risen steadily over the 2000-2013 period. In Indonesia, the tax-to-GDP ratio increased by 4.5 percentage points, in Malaysia it rose by 2.3 percentage points and increase was of 0.5 percentage points in the Philippines. This compares to a decline of 0.2 percentage points across the OECD.
Revenue Statistics in Asian Countries: Trends in Indonesia, Malaysia and the Philippines provides cross-country comparisons across these economies together with Japan and Korea. Comparable and consistent tax statistics facilitate transparent policy dialogue and provide policy makers with an important tool to assess alternative tax reforms.
Beyond statistics in this year’s report - the second edition of Revenue Statistics in Asian Countries and the first to include the Philippines - a special feature provides country profiles on recent tax administration and related reforms in Indonesia, Malaysia and the Philippines. Continued reforms will be necessary to help these tax administrations raise additional tax revenues in the future.
Revenue Statistics in Asian Countries forms part of the OECD’s Global Revenue Statistics project, which currently includes OECD Revenue Statistics, Revenue Statistics in Latin America and the Caribbean and a forthcoming publication of Revenue Statistics in Africa.
The OECD launched a Southeast Asia Regional Programme in 2014 that aims to bring the relationship of the OECD and Southeast Asian countries to a new, more strategic level, support domestic reform processes and contribute to regional