Tax Expenditures in Latin America: A Review

Key takeaways from the LAEO

The OECD says that the tax revenues collected in LAC countries are “currently insufficient” to meet their development objectives, but that statement means very little. In other words, it is expected that developing countries, many of which are in the LAC region, will have budget deficits that explain some of their structural handicaps.

Governments are less capable of meeting welfare objectives, which in turn incentivizes (or forces) people to migrate, which then reduces the size of their local market (taxed by VAT) and workforce (taxed by social security or personal income taxes, albeit at lower levels than those found in OECD members). Poor infrastructure, institutional instability and competition with their neighbors are some of the reasons why increasing (or even redistributing) the national tax burden is an impractical solution for many LAC governments.

With all that said, LAC is still one of the most attractive regions of the world in terms of FDI – about 14% of the global FDI in 2022 and 2023. The OECD says that some of the factors that contributed to these numbers include the Russian war against Ukraine (which incentivized a reallocation of investments in the energy sector), profit withholding by some local corporations, and nearshoring projects, especially in Mexico.

The LAEO also highlights that worker productivity in LAC countries was only 33% of the OECD average in 2023, and that this gap has widened since 1990. One of the reasons offered for the low productivity growth in the region is what the OECD refers to as a “suboptimal allocation of resources”, meaning “when established firms are favoured over innovative startups or when capital is channelled towards politically connected enterprises rather than those with higher growth potential.” This is reminiscent of tax incentives in Honduras, which under the Presidency of Juan Orlando Hernández benefitted a handful of business entities and individuals (with no meaningful welfare gains). Local tax authorities estimate that the revenue losses associated with those incentives amounted to more than HNL 57 billion (about USD 2.2 billion) between 2017 and 2023.

The OECD says that, while tax incentives can incentivize investment, “such effects are uncertain and heterogeneous and depend on incentive design, firm and asset characteristics, and the economic context.” This is aligned with another report produced by the Organization in 2022 and titled “Tax Incentives and the Global Minimum Corporate Tax: Reconsidering Tax Incentives after the GloBE Rules.” In that report, it is said that GloBE rules are less likely to affect “expenditure-based tax incentives that target payroll or tangible assets” (income-based tax incentives like tax holidays or IP boxes are among the most affected), and that developing countries have used “wasteful and ineffective” tax incentives to attract FDI prior to Pillar 2. With that in mind, it is worth noting that certain LAC countries reduce the effective taxation of companies in strategic sectors to half of the statutory rate or even zero (e.g., for the textile industry in the Dominican Republic).

The OECD reiterates some of its observations in previous reports when it says that LAC has “room” to expand both health taxes and environmental taxes. This is based on the notion that tax policy is the most suitable tool to correct negative externalities caused by the consumption of sugary beverages or tobacco, or the production and distribution of fuel. Governments can use tax policy to achieve broader welfare objectives in many ways, from imposing a tax on “harmful” activities to offering benefits, and therefore distorting market behavior, based on compliance with statutory criteria. The criticism against these policy recommendations, especially when they propose the introduction of a new tax or an increase to an existing tax, is that they place governments in the tricky position of relying on taxes (and their revenues) to combat societal issues that ensure their payment. To put it differently, the OECD report titled “Tobacco Taxation in Latin America and the Caribbean: A Call for Tobacco Tax Reform” discussed options for taxing tobacco at length, but it did not address what governments should do with the revenues they collect from taxing tobacco (meaning governments may use those revenues to fund budget items totally unrelated to the reduction of tobacco consumption in their territories).

Before we dive into the Latin American “Country notes” of the LAEO, there is a final section in Chapter 2 that explores what the OECD refers to as “tax morale”, or the voluntary, intrinsic motivation to pay taxes. This is highlighted in the report because the OECD says that LAC countries have collected “low tax revenues” and that they need to “create a virtuous cycle” to raise needed revenues and “spend them in a more progressive and transparent manner”. It comes from the perception that people in the LAC region are more and more inclined to evade paying taxes because they do not see tax revenues being effectively used to finance public goods and services, and that in turn comes from a poll conducted by Latinobarómetro in 2023. The OECD does not explain this in the LAEO, but the question posed by the pollsters was not simply “do you find non-payment of taxes to be justified in your country?”. It was instead “on a scale of 1 to 10, where 1 is ‘not at all’ and 10 is ‘totally justified’, how justifiable do you think it is for people to evade paying taxes?” (emphasis added).

This distinction is important for three reasons. One, for the average citizen, the term “evasion” (in Spanish and Portuguese, “evadir”) carries a criminal connotation, so a response in favor of “evasion” is far more impactful for tax morale than it would be if the question asked about “non-payment”. Two, nearly 40% of the people that were polled still find the notion of evading tax to be completely unjustified, with just 5% finding it totally justified in the LAC region in 2023 – also, most of the in-between answers are still in the “2 to 5” range out of 10, meaning that people are more inclined to criticizing tax evasion than acquiescing to it. Three, and this is a problem with these sorts of polls, non-tax people are usually unable to distinguish between cases of tax evasion, tax avoidance, and legitimate tax planning (enabled by applicable law). This semantic confusion can be advantageous for government officials aiming to increase tax revenues; when the public conflates lawful tax planning with illegal tax evasion, they tend to support measures that may unfairly target legitimate strategies employed by taxpayers to structure their business affairs.

Here are the tax highlights of Latin American “Country notes” found at the end of the LAEO:

🇦🇷 Argentina: The Ley de Medidas Fiscales Paliativas y Relevantes and the Ley de Bases y Puntos de Partida para la Libertad de los Argentinos, both from 2024, contain provisions that improve transparency and also reinforce fiscal governance. One of the recent tax incentives provided to small taxpayers is a withholding tax exemption for payments made to them via electronic payment processors.

🇧🇷 Brazil: The LAEO highlights three important tax reforms carried out in Brazil in recent years. The first is the introduction of a new transfer pricing regime in line with the OECD Transfer Pricing Guidelines. The second is a new law that applies the country’s CFC rules to individual controllers, and that was passed in 2023. Finally, Brazil is going through the process of reforming its indirect tax system, from the current system of five main taxes divided between three levels of government to a new framework of two main national, VAT-like taxes in addition to a new “selective tax” and the Excise Tax on Industrialized Products for specific activities.

🇨🇱 Chile: Though the LAEO refers to the Chilean tax reform as a bill, it has been approved and published as a law in 2024 (also known as Ley de Cumplimiento Tributario). The law has increased penalties for severe tax offenses and has also expedited processes for bypassing the bank secrecy of taxpayers, among other provisions. Furthermore, it removed exemptions from VAT to imports of goods below USD 500 (now generally subject to a VAT of 19%).

🇨🇴 Colombia: The LAEO does not cite tax-related developments in Colombian public policy, but it is worth noting that in September 2024 the Presidency of Colombia presented to Congress a bill of law designed to modify both income tax and VAT rules. That reform, which reduced CIT rates and increased both carbon taxes and VAT (e.g., for hybrid vehicles and online gambling), was rejected in December by Congressmembers, but what it shows is a certain level of tension between current levels of tax collections and government plans in the public budget.

🇨🇷 Costa Rica: Of the four members of the OECD in Latin America, Costa Rica is the most recent, having joined the Organization in May 2021. The LAEO refers to the “Fiscal Rule”, a set of fiscal controls that were introduced by a 2018 law called Ley de Fortalecimiento de las Finanzas Públicas. It was approved in 2020 and it establishes that the growth on current expenditures has to be “a function of the average nominal GDP growth over the previous four years, adjusted by a parameter that depends on the government debt-to-GDP ratio.” The OECD also refers to a program of the Directorate General of Taxation for the collection of tax arrears in August 2024 (with an estimate of over CRC 70 billion in additional revenues).

🇩🇴 Dominican Republic: The LAEO refers briefly to “forthcoming tax reforms” in the Dominican Republic supposed to “ensure equitable contributions from all sectors of society, and strengthen overall fiscal management.” The OECD may be referring to a bill of law known as Proyecto de Ley de Modernización Fiscal, which was presented to the Dominican parliament on October 8th, 2024, and withdrawn just a few days later after opposition from politicians, business representatives, and industry associations (because parts of its text would have repealed their existing tax incentives).

🇪🇨 Ecuador: The OECD states that the country has been focusing on “promoting redistributive economic policies and equitable tax collection.” This refers to a document called Plan de Desarrollo para el Nuevo Ecuador 2024-2025, a government plan that proposed increases in tax collections to finance the public budget. One of the measures in that regard was the increase of the local VAT from a general rate of 12% to 15% in April 2024.

🇸🇻 El Salvador: There is very little in the LAEO about El Salvador’s recent tax reforms. What the OECD says here is that a recent law has exempted passive income earned by local residents offshore from income tax, which is not 100% true if you read Legislative Decree No. 969. What it says instead is that these earnings are “not income” for purposes of the local income tax (meaning, it is the difference between establishing them as income and not taxing them versus stating that they are not within the scope of the local income tax law at all). The Country note does not cite what perhaps is the most significant tax reform in El Salvador in recent years, meaning the Ley de Fomento a la Innovación y Manufactura de Tecnologías, which was approved back in May 2023. That law exempted qualifying tech companies from paying income tax, municipal taxes, capital gains tax, and even import tax for 15 (fifteen) years.

🇬🇹 Guatemala: The references in the LAEO about Guatemala’s tax policy have more to do with developments to the local tax administration. Guatemala has transitioned from a prior public invoicing system to the Régimen de Factura Electrónica en Línea (FEL), which since its full implementation in 2023 has required local taxpayers to use electronic signatures to validate local Electronic Tax Documents. The local tax administration has also launched an ambitious Tax Audit Plan to improve monitoring, audit and assessment functions against non-compliant taxpayers in 2024.

🇲🇽 Mexico: The LAEO lists several measures introduced by Mexico to modernize and balance its local tax system. Mexico deposited its instrument of ratification of the BEPS MLI on March 15, 2023, meaning that Covered Tax Agreements with countries like Australia, France and Japan should now be read and applied in line with (some of the) BEPS minimum and reinforced treaty standards. Mexico has also passed a tax reform in 2019 that incorporated the proposals of BEPS Action 2 (hybrid mismatches), Action 3 (CFC rules), Action 4 (interest deductibility limitation) and Action 7 (PE) into local law. Finally, the country has reduced the local VAT to zero on menstrual products since 2021.

🇵🇦 Panama: The only reference made in the LAEO about Panama’s tax system is that it fosters “an investment-friendly environment characterised by historically low tax rates.” They fail to mention that, following the adjustment of its local multinational headquarters regime (SEM) and Pacific economic regime back in 2018, Panama has since become aligned with the minimum standard of BEPS Action 5. This Country note also sidelines Panama’s ratification of the BEPS MLI in November 2020, which proposed the amendment of 17 tax treaties in its network.

🇵🇾 Paraguay: Paraguay has “implemented significant measures focusing on tax system modernisation and strategic reforms”, according to the OECD, and here they reference a 2019 law that “played a crucial role in expanding Paraguay’s tax base and increasing revenue,” unifying previous Income Taxes and adding new provisions such as allowance of the carry-forward of taxable losses and transfer pricing regulations. This is likely a reference to Ley Nº 6.380/19, a very extensive piece of legislation approved in September 25, 2019.

🇵🇪 Peru: The OECD refers to the “complete implementation” of the Peruvian General Anti-Avoidance Rule, but what this means in practice is that Decreto Supremo N.º 145-2019-EF introduced a number of procedural requirements for local tax authorities to disregard transactions/structures for tax purposes in May 2019. The Organization cites a law, Ley Nº 31110, which in its Art. 10 states that income tax rates for individuals and legal entities in the agricultural sector will be raised progressively until they reach the standard rate (which today is 29.5% for legal entities). Specifically in terms of tax expenditures, however, the OECD cites (i) Decreto Legislativo N.º 1488 and Ley Nº 31652, which “encourage private investment through special depreciation regimes and temporary measures for buildings, construction, and electric vehicles.” They also reference (ii) Ley Nº 30309, which “promotes scientific research and technological innovation by providing additional tax deductions for related expenses,” though this is a relatively old law published in March 2015.

🇺🇾 Uruguay: In 2022, the Uruguayan government announced a reduction to zero of their Specific Internal Tax (Impuesto Específico Interno, or IMESI) on electric vehicles. Uruguay has also adopted several tax reduction measures via Ley Nº 20.124, of March 24, 2023. These include the reduction of the local Individual Income Tax (via increased deductions for low-income taxpayers) reduce the scope of the local Social Security Tax (part of a progressive plan to remove it from the Uruguayan tax system).

One immediate reaction to these Country notes (and their highlights in terms of tax policy measures) is that Latin American tax policy, while sharing some historical and cultural traits, is not a monolith. Some countries are actively pursuing non-compliant actors (like Guatemala) whereas others are reducing taxes and doing what they can to attract FDI (like El Salvador and Uruguay). Some countries belong to the OECD and are naturally “in sync” with OECD recommendations and proposals in the tax space, whereas others try to find their own pathway between developed and developing partners. This is all relevant for the analysis of the GTETI below.

Key takeaways from the GTETI

As explained in the Tax Expenditures Lab companion paper, the GTETI is “the first comparative assessment of [tax expenditure] reporting” covering jurisdictions across the globe. It provides “a systematic framework to rank jurisdictions according to the quality of their [tax expenditure] reporting,” focusing on five “dimensions”: (1) Public availability, (2) Institutional framework, (3) Methodology and scope, (4) Descriptive tax expenditure data, and (5) Tax expenditure assessment. The cutoff date for this version of the index, available since December 2024, was December 31, 2022.

The five “dimensions” listed in the companion paper are normative in nature, meaning that the core concern of the GTETI is not with the revenue/welfare gains of the tax expenditure program implemented in a given jurisdiction, but with its transparency, regular assessment, and openness for improvement. In other words, if a country has a high score across these five dimensions of the GTETI, it has the “structure in place” to detect and adjust inefficient tax incentives (so it would be expected that if an inefficient tax incentive is approved by the local Legislative or Executive Power, it should have a short lifespan). The report even includes an Annex with “An Ideal Tax Expenditure Report”, a document with details about individual tax expenditures, what their stated policy objectives are, who their targeted beneficiaries are, estimates of forgone revenues associated with them, and so on.

The GTETI ranking provides a very interesting snapshot of the dynamics of tax expenditure control and reporting in Latin America. It shows a list of 218 jurisdictions in total, but only 105 of those had enough data to be scored across the five dimensions (other countries appear in the ranking with a “zero” out of 100 points). Here are a few highlights considering the 14 countries featured in the LAEO:

 

• South Korea has the highest score across the aggregate of all five dimensions, with 76.1 out of 100 (although it does not have the best score in any individual dimension). Brazil appears in 7th place with a total score of 65.3 out of 100 and its highest-scoring individual dimension is “Public Availability” (15.3 out of 20).
  
  
• Ecuador is the 13th jurisdiction on the list with a total score of 61.7, followed by Uruguay in 18th with 59.9, Costa Rica in 29th with 55.4, and a list of LAC countries in positions 35 to 38: Colombia (52.3), Peru (52.1), Chile (52.0) and the Dominican Republic (51.9).
  
  

• Mexico appears as the 51st country on the list, with a total score of 46.1 (behind Argentina in 42nd with a score of 50.4 and El Salvador in 43rd with a score of 49.2). Guatemala appears several positions below at 62nd with a score of 42.4, but the drop is significantly steeper from Guatemala to Paraguay in 92nd (29.0) and Panama in 96th (25.7). Considering that other countries below the 105th position have a score of zero, of the surveyed and scored countries, Panama is the lowest-performing jurisdiction in the LAC region.
  
  

• Some of the individual dimension scores of LAC countries are very low, with Paraguay having scored zero on the dimension of “Methodology and Scope” and 1.3 on the dimension of “Descriptive tax expenditure data”. Another very low score was attributed to the Dominican Republic on the dimension of “Tax expenditure assessment” – just 2.4 out of a possible score of 20.

 

It is noteworthy that Brazil is 22 positions ahead of Costa Rica, the first OECD member of the LAC region in the GTETI ranking. This is likely a result of Brazil’s well-known advances in digital tax administration in the last 30 years. You might find some correlation between references in the LAEO about projects and initiatives to “increase” or “improve” transparency in LAC countries with middle to low scores, but that is just one of many criteria within the five dimensions of the GTETI.

There are some interesting links between this ranking and the recent update to the OECD Investment Tax Incentives Database (ITID), which was released on March 19, 2025. The OECD says that, among developing countries, CIT incentives have become more prevalent in the 52 economies surveyed in the ITID of 2022 and 2024 (including the LAEO jurisdictions, except for Chile, Guatemala, Mexico and Panama). It also says that more than a third of tax incentives in the database target “sustainable development goals”, which is in line with some of the Country notes in the LAEO (e.g., Colombia, Peru). However, in about three quarters of surveyed jurisdictions (71%), CIT incentives are “scattered across several laws and regulations,” something that can “reduce their transparency for investors and complicate monitoring and evaluation.”

Final remarks

Most countries in the LAC region have scored relatively poorly in the GTETI, and that does not come as a surprise. Politically, granting tax incentives to favored business sectors – or even to specific entities – is far simpler, but it undermines fiscal sustainability. LatAm governments often struggle with deep-rooted financial challenges, which means that they must balance enforcing substance-based and performance-based FDI requirements while ensuring that FDI is not diverted to neighboring countries.

 

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¹  Lucas de Lima Carvalho is the founder of the Latin American Tax Policy Forum. He is based in São Paulo, Brazil.

²  See OECD. Latin American Economic Outlook 2024: Financing Sustainable Development. Paris: OECD, 2024. Considering the focus of the OECD report on Latin America and the Caribbean, all of our references to Latin American jurisdictions – when based on this specific report – will be labelled as “LAC”.

³  Id., p. 12.

⁴  Id.

⁵  See WID. Inequality in 2024: A Closer Look at Six Regions. World Inequality Database, posted on November 19, 2024.

⁶  See OECD, supra note 1, p. 12.

⁷  Not a dedicated section on the website of the Tax Expenditures Lab, but the individual pages and data corresponding to countries in the Latin American region.

⁸  See TAX EXPENDITURES LAB. The Global Tax Expenditures Transparency Index. Version 1.1, released on December 19, 2024.

⁹  See OECD, supra note 1, p. 19. 

¹⁰  Id., p. 19-20.

¹¹  A recent study of 43 countries in Sub-Saharan Africa over the period of 2000 to 2020 indicates that “institutional quality has a significant negative impact on tax revenue instability,” but it also stresses that “the influence of institutional quality is more pronounced in resource-rich countries than in resource-poor countries.” See NIKIEMA, Roukiatou; and ZORE, Mahamoudou. Tax revenue instability in Sub-Saharan Africa: Does institutional quality matter? American Journal of Economics and Sociology, Volume 84, Issue 1. Hoboken: Wiley, 2024, p. 174.

¹²  See OECD, supra note 1, p. 43.

¹³  Id.

¹⁴  Id. The example cited in the LAEO is Argentina, but the report refers to local subsidiaries having “decided to reinvest the profits generated during the year rather than transfer them to the parent company.” It is widely known, however, that Argentina has a system of foreign exchange controls that effectively restricts cross-border transactions (such as the payments of dividends). This has started to change only very recently with the permission given to clients of currency exchange houses and financial institutions to acquire Bonds for the Reconstruction of a Free Argentina (BOPREAL). See ARGENTINA. Comunicación “A” 7999. Central Bank of Argentina (BCRA), published on April 30, 2024.

¹⁵  See OECD, supra note 1, p. 43.

¹⁶  Id., p. 36.

¹⁷  Id.

¹⁸  See HONDURAS. Los 10 Puntos de la Ley de Justicia Tributaria. Servicio de Administración de Rentas (SAR), Nota de Prensa RRPP 006-2023. Posted on March 9th, 2023. See also OBANDO, Roberto Ramos. Tax Justice Bill Stirs Controversy in Honduras. Tax Notes International, Volume 113, Number 12. Falls Church: Tax Analysts, 2024, p. 1635-1640.

¹⁹  See OECD, supra note 1, p. 90.

²⁰  See OECD. Tax Incentives and the Global Minimum Corporate Tax: Reconsidering Tax Incentives after the GloBE Rules. Paris: OECD, 2022.

²¹  Id., p. 7.

²²  Id., p. 6.

²³  See OECD, supra note 1, p. 90-91.

²⁴  Id., p. 93-94.

²⁵  A recent bill of law introduced in the Brazilian House of Representatives proposes a new “Detox tax” on the consumption of digital content (set at 1% of gross revenues of companies in the sector, though the rate can be reduced in half if the taxpayer complies with specific criteria, such as the placement of parental control and the protection of data of children and teenagers using their platforms). See BRAZIL. Projeto de Lei nº 1068/2025. Authored by Dep. Alex Santana (REPUBLIC/BA), presented on March 18, 2025.

See comments in CARVALHO, Lucas de Lima. OECD Tobacco Tax Report Faces Global Reforms’ Typical Obstacles. Bloomberg Tax, posted on November 12, 2024.

²⁶  Id.

²⁷  See OECD, supra note 1, p. 105.

²⁸  Id.

²⁹  Id. See also LATINOBARÓMETRO. Análisis Online: Cuán justificable cree que es evadir impuestos. Pregunta 119/214, Year 2023. Last access on March 22, 2025.

³⁰  Id. (translated from Spanish)

³¹  Id.

³²  And within those categories, the sub-categories of “tax evasion as it is defined by tax authorities” vs. “tax evasion as it is defined by courts”, or the same differentiation within tax avoidance. This is an example of a poll that is premised on someone having evaded their taxes, which sidesteps the important discussion of whether what the government calls “evasion” actually took place. 

³³  See OECD, supra note 1, p. 232. See also ARGENTINA. Ley 27743 de 27-jun-2024. The Honorable National Congress of Argentina, published on July 8th, 2024.

³⁴  See ARGENTINA. Ley 27742 de 27-jun-2024. The Honorable National Congress of Argentina, published on July 8th, 2024.

³⁵  See ARGENTINA, supra note 33, Art. 102. 

³⁶  See OECD, supra note 1, p. 234. See also BRAZIL. Lei nº 14.596, de 14 de junho de 2023. Presidency of Brazil, published on June 15, 2023.

³⁷  See BRAZIL. Lei nº 14.754, de 12 de dezembro de 2023. Presidency of Brazil, published on December 13, 2023.

³⁸  See BRAZIL. Emenda Constitucional nº 132, de 20 de dezembro de 2023. Presidency of Brazil, published on December 21, 2023. See also BRAZIL. Lei Complementar nº 214, de 16 de janeiro de 2025. Presidency of Brazil, published on January 16, 2025 (republished on January 23, 2025).

³⁹  See OECD, supra note 1, p. 236. See also CHILE. Ley 21713. National Congress of Chile, published on October 24, 2024.

⁴⁰  See CAREY. Tax Compliance Law: Main amendments introduced in customs matters. Written by Matías Vergara, Francisco León, Consuelo Gálvez, Florencia Martínez. Posted on October 28, 2024.

⁴¹  See OECD, supra note 1, p. 238. See also COLOMBIA. PL.300-2024C (Ley de Financiamiento). Colombian House of Representatives, presented/received on September 10, 2024.

⁴²  See PWC. Colombian executive branch presents a new tax reform bill before the congress. Posted on October 16, 2024.

⁴³  See REUTERS. Colombian lawmakers vote against government’s $2.24 billion tax reform. Posted on December 11, 2024.

⁴⁴  See OECD, supra note 1, p. 240. See also OECD. OECD welcomes Costa Rica as its 38th Member. Posted on May 25, 2021.

⁴⁵  See IMF. Costa Rica: Technical Assistance Report-Upgrading the Rule-Based Fiscal Framework. Washington D.C.: IMF, 2023, p. 11.

⁴⁶  See OECD, supra note 1, p. 240.

⁴⁷  Id., p. 242.

⁴⁸  See ACENTO. Retiro del proyecto de Ley de Modernización Fiscal del Congreso Nacional. Written by Dinorah García Romero, published on October 21, 2024.

⁴⁹  See OECD, supra note 1, p. 242.

⁵⁰  See ECUADOR. Plan de Desarrollo para el Nuevo Ecuador 2024-2025. National Planning Council, approved on February 16, 2024.

⁵¹  “Política 4.6: Fortalecer un sistema tributario de forma progresiva, equitativa y eficiente. Estrategias: (a) Incrementar la recaudación tributaria y disponer de mayores ingresos permanentes para el Presupuesto General del Estado.” Id., p. 113.

⁵²  See PRIMICIAS. Ecuador: El IVA al 15% está vigente desde este lunes 1 de abril. Published on April 1st, 2024.

⁵³  See OECD, supra note 1, p. 244.

⁵⁴  See EL SALVADOR. Decreto No. 969. Legislative Assembly of El Salvador, approved on March 14, 2024, published on March 22, 2024.

⁵⁵  See EL SALVADOR. Decreto No. 722. Legislative Assembly of El Salvador, approved on May 4th, 2023, published on May 9th, 2023.

⁵⁶  See OECD, supra note 1, p. 246.

⁵⁷  See EDICOM. How to Comply with Electronic Invoicing in Guatemala and the FEL System. Updated as of February 13, 2025.

⁵⁸  See WORLD LAW GROUP. Guatemala: Tax Audit Plan 2024. Written by Ximena Tercero and Estaymer Mendoza. Published on January 29, 2024.

⁵⁹  See OECD, supra note 1, p. 248. See also OECD. Mexico deposits its instrument for the ratification of the Multilateral BEPS Convention. Posted on March 15, 2023. Australia, France and Japan have all signed and ratified the BEPS MLI – they have also all listed their respective tax treaties with Mexico as Covered Tax Agreements for purposes of the BEPS MLI. See OECD. Signatories and Parties to the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting. Status as of January 10, 2025.

⁶⁰  See WHITE & CASE. Mexico 2020 Tax Reforms. Posted on November 6th, 2019.

⁶¹  See CALDERÓN-VILLAREAL, Alhelí. Taxing women’s bodies: the state of menstrual product taxes in the Americas. The Lancet Regional Health – Americas, published on November 24, 2023.

⁶²  See OECD, supra note 1, p. 250.

⁶³  See BDO. Overview of changes to special tax regimes and introduction of new regime. Written by Simone Mitil and Malvis Mina. Corporate Tax News Issue 59 – July 2021.

⁶⁴  See PANAMA. Panamá ratificó la Convención Multilateral de la OCDE y avanza en el cumplimiento de los estándares internacionales. Posted on November 12, 2020.

⁶⁵  See OECD, supra note 1, p. 252.

⁶⁶  See PARAGUAY. Ley Nº 6380. Library of National Congress, approved on September 25, 2019.

⁶⁷  See OECD, supra note 1, p. 254. See also PERU. Gobierno publicó Decreto Supremo de la Norma Antielusiva General como herramienta efectiva para prevenir y perseguir la elusión Tributaria. Ministry of Economy and Finance, published on May 6th, 2025.

⁶⁸  See PERU. Ley Nº 31110. Congress of the Republic of Peru, published on December 31, 2020. See also PWC. Peru: Corporate – Taxes on corporate income. Written by Orlando Marchesi and Javier Barrios. Last reviewed on February 10, 2025.

⁶⁹  See PERU. Decreto Legislativo N.° 1488. Congress of the Republic of Peru, published on May 10, 2020.

⁷⁰  See PERU. Ley Nº 31652. Congress of the Republic of Peru, published on December 29, 2022.

⁷¹  See OECD, supra note 1, p. 254.

⁷²  See PERU. Ley Nº 30309. Congress of the Republic of Peru, published on March 13, 2015.

⁷³  See OECD, supra note 1, p. 254.

⁷⁴  Id., p. 256.

⁷⁵  See URUGUAY. Gobierno suprime Imesi para vehículos eléctricos y promueve acuerdos para movilidad sostenible. Presidency of Uruguay, published on February 16, 2022.

⁷⁶  See TELENOCHE. Lacalle Pou: “cerca de 63.000 uruguayos dejarán de pagar IRPF”. Published on March 2nd, 2023. See also URUGUAY. Ley Nº 20.124. Presidency of Uruguay, sanctioned on March 24, 2023.

⁷⁷  See TAX EXPENDITURES LAB. The Global Tax Expenditures Transparency Index – Companion Paper. Written by Agustin Redonda, Lucas Millan, Christian von Haldenwang, Sofia Berg and Flurim Aliu. Revised version, December 3rd, 2024, p. 5-6.

⁷⁸  Id.

⁷⁹  Id., p. 31-35.

⁸⁰  See TAX EXPENDITURES LAB, supra note 7.

⁸¹  Id. Criteria within this dimension includes regular annual publication, timely data, and easy public access. Reports should be visible, accessible in user-friendly formats, and designed for clarity, including summaries and versions for visually impaired readers.

⁸²  Id. Though Honduras was not covered by the LAEO, it appears as the 31st jurisdiction in the GTETI ranking (with a score of 54.9 out of 100).

⁸³  Id. Though Bolivia was not covered by the LAEO, it appears as the 85th jurisdiction in the GTETI ranking (with a score of 33.8 out of 100).

⁸⁴  Id. Criteria includes comprehensive tax coverage, clear benchmarks, and making a distinction between structural and non-structural reliefs. Reports should justify these classifications at the individual level of each tax expenditure.

⁸⁵  Id. Criteria includes estimates of forgone revenue alongside key contextual details. Tax expenditure reports should include policy objectives, the specific taxes covered by the expenditure, beneficiary groups, timeframes, and legal references for each tax expenditure provision.

⁸⁶  Id. Criteria includes disaggregated estimates, multi-year projections, and tax expenditure evaluations. The key aspects of this dimension are a structured evaluation framework and the availability of assessment results in tax expenditure reports.

⁸⁷  See IADB. Digitalization of tax administration in Latin America and the Caribbean: best-practice framework for improving e-services to taxpayers. Written by Gerardo Reyes-Tagle, Christina Dimitropoulou and Christian Camilo Rodríguez Peña. Washington D.C.: IADB, 2023, p. 31-33.

⁸⁸ See, for example, OECD, supra note 1, p. 236 (Chile), 246 (El Salvador) and 248 (Guatemala).

⁸⁹  See OECD. OECD Investment Tax Incentives Database 2024 update: Corporate income tax incentives in emerging and developing economies. Paris: OECD, 2025.

⁹⁰  Id., p. 6.

⁹¹  Id., p. 7.