This report is the second edition of Tax Policy Reforms: OECD and Selected Partner Economies, which is an annual publication that provides comparative information on tax reforms across countries and tracks tax policy developments over time. This year’s report covers the tax reforms that were implemented, legislated or announced in 2016. Two non- OECD countries, Argentina and South Africa, have been included in this year’s edition, in an effort to progressively expand the scope of the publication to key partner economies. Monitoring tax policy reforms and understanding the context in which they were undertaken is crucial to informing tax policy discussions and to supporting governments in the assessment and design of tax reforms.

Growth has been slowly picking up and this is welcome news. But countries are still facing a vicious circle of low productivity growth, sluggish demand, stagnant wages and, in many countries, rising or high levels of inequalities. Over the decade since the financial crisis, the OECD has become increasingly concerned about the persistent inequalities in growth, income, and wealth within and between countries and has encouraged a shift from a narrow focus on economic growth towards a greater emphasis on inclusiveness. Indeed, ensuring that growth is broad-based and does not leave large sections of the population behind is crucial to future economic and social prosperity.

This report is the second edition of Tax Policy Reforms: OECD and Selected Partner Economies, which is an annual publication that provides comparative information on tax reforms across countries and tracks tax policy developments over time. The report covers the tax policy reforms that were implemented, legislated or announced during calendar year 2016 in all OECD countries as well as in Argentina and South Africa

This chapter gives an overview of the main macroeconomic trends from the end of the crisis until 2016. The purpose of this overview is to provide background information to help understand tax revenue trends as well as tax policy changes. Tax policy reforms are closely connected with economic trends: tax revenues are affected by changes in macroeconomic conditions and economic trends themselves are key drivers of tax reforms.

This chapter describes tax revenue trends – looking at both total tax-to-GDP ratios and tax mixes – in OECD countries, Argentina and South Africa. The analysis covers tax revenue trends until 2015, the latest year for which comparable tax revenue data is available. This overview of tax revenue trends is useful to understand the effects of past tax policy reforms and sets the stage for the subsequent discussion on the tax reforms that were introduced in 2016.

This chapter provides an overview of the tax reforms that were introduced in 2016 in OECD countries, Argentina and South Africa. It identifies the most significant tax reforms that were implemented, legislated or announced during calendar year 2016 as well as common tax policy trends across groups of countries. It starts with a summary of tax reforms across all countries and a brief overview of the countries that introduced the most comprehensive tax reforms in 2016. It then looks at trends in each category of tax separately, including personal income taxes and social security contributions, corporate income taxes, VAT/GST and excise duties, environmentally related taxes and property taxes.