Tax bases must widen, says IMF
MIDDLE Eastern countries should pursue fiscal policies to support growth and build broader tax bases to fund infrastructure projects and social spending, IMF MD Christine Lagarde said yesterday.
“A key priority is building broader and more equitable tax bases. All must pay their fair share, while the poor must be protected,” Largarde said here.
That would allow them to spend more on social safety nets, health and education services than the present 11% of GDP in the region, less than 19% in emerging Europe.
“Fiscal policy can and must be redesigned to support inclusive growth in the region,” Largarde said.
A senior IMF official said on Monday that Morocco’s new, more flexible hard currency system was a step in the right direction to make the kingdom more attractive to investment and to turn it into a financial hub for Africa.
Two weeks ago, Morocco launched a more flexible foreign exchange system under free-market reforms recommended by the International Monetary Fund to protect the North African economy against external shocks and safeguard its reserves.
“It’s a reform that goes in the right direction,” Jihad Azour, director of the IMF Middle East and Central Asia department, said.
“It allows Morocco to be more attractive for investors and to play its full role as regional financial centre especially with the ambition of Morocco to service Africa in terms of financial services,” he said. – Reuters