IMF against reduction in VAT
The International Monetary Fund (IMF) has warned the government that there is no room, at this point, to reduce the Value Added Tax (VAT).
As a matter of fact, the New Democratic Party administration has been told that more goods and services need to be subjected to VAT.
“A comprehensive tax reform would result in a more growth-friendly and equitable system.
“The authorities have expressed interest in additional technical assistance from the Fund.
“To improve efficiency and collection, the VAT base needs to be broadened.
“There is no room to lower the VAT standard rate. Instead, the special rate for tourism should be brought in line with the standard rate,” Sergei Antoshin, the leader of a visiting IMF team said at a press conference at Cabinet Room on Tuesday, April 28, 2026.
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