Strengthening Tax Governance Through Legal Design

IMF Working Papers, January 17, 2025

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Well-functioning tax systems anchor their governance arrangements in law.
The paper develops an analytical framework to derive core legal principles for sound tax governance to inform the design of countries’ legal frameworks for administration and tax procedure.
The framework is applied to derive key legal features that should be embedded in laws for tax administration—including additional considerations for semi-autonomous revenue authorities—and tax procedure, to ensure a balance between tax administration powers and adequate taxpayer protections.

Develops an analytical framework from which core legal principles for sound tax governance can be derived.
Uses the framework to inform the legal design of:
- Tax administration laws.
- Tax procedure laws.
- Additional legal considerations for semi-autonomous revenue authorities.

Core legal principles for tax governance should be embedded in law to anchor governance arrangements.
Legal design should balance tax administration powers with adequate taxpayer protections.
The paper addresses both general tax administration and specific considerations for semi-autonomous revenue bodies.

Embed key legal features in tax administration laws to define and constrain administrative powers.
Design tax procedure laws that provide clear taxpayer protections and procedural fairness.
Incorporate additional legal safeguards and governance features for semi-autonomous revenue authorities to ensure accountability and balance.

Subjects: Revenue administration, Semi-autonomous revenue bodies, Tax administration core functions, Tax law, Tax policy, Taxpayer charter.
Keywords: A. tax Governance, design consideration, governance arrangement, legal design, Semi-autonomous revenue bodies, tax administration, Tax administration core functions, Tax governance, tax law, tax procedure, Taxpayer charter, taxpayer relationship.