Peru’s Works for Taxes Scheme
Created in Peru in 2008, Works for Taxes is an innovative approach to accelerating infrastructureinvestment. It allows private firms to “pay” their income taxes in advance through the execution ofpublic works projects. By accepting infrastructure projects in lieu of future taxes, national, regional, and local governments can forego mobilization of public funds and reduce the burden on government budgets, as the private sector assumes the upfront costs and management of new infrastructure projects. The mechanism’s success derives from its ability to align public and private sector incentives for better quality projects and more efficient use of funds. Works for Taxes has great potential for replication in other emerging market countries with similar obstacles to infrastructure investment.
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Format: | Brief biblioteca |
Language: | English |
Published: |
International Finance Corporation, Washington, DC
2018-06
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Subjects: | INFRASTRUCTURE FINANCE, INFRASTRUCTURE INVESTMENT, PUBLIC WORKS, TAXATION, PUBLIC-PRIVATE PARTNERSHIPS, EMERGING MARKET ECONOMIES, |
Online Access: | http://documents.worldbank.org/curated/en/163871532527022459/Peru-s-works-for-taxes-scheme-an-innovative-solution-to-accelerate-private-provision-of-infrastructure-investment http://hdl.handle.net/10986/30381 |
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Summary: | Created in Peru in 2008, Works for Taxes
is an innovative approach to accelerating
infrastructureinvestment. It allows private firms to “pay”
their income taxes in advance through the execution ofpublic
works projects. By accepting infrastructure projects in lieu
of future taxes, national, regional, and local governments
can forego mobilization of public funds and reduce the
burden on government budgets, as the private sector assumes
the upfront costs and management of new infrastructure
projects. The mechanism’s success derives from its ability
to align public and private sector incentives for better
quality projects and more efficient use of funds. Works for
Taxes has great potential for replication in other emerging
market countries with similar obstacles to infrastructure investment. |
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