Upon completion of this course, participants will be able to:

• Define and identify a tax expenditure according to international and domestic standards.
• Apply different methodologies (e.g., revenue foregone, outlay equivalent) to measure the cost of a tax expenditure.
• Conduct a rigorous cost-benefit analysis for a specific tax expenditure program.
• Integrate tax expenditure analysis into the standard annual budget process.
• Evaluate the effectiveness, efficiency, and equity of a tax expenditure as a policy tool.
• Draft comprehensive tax expenditure reports for legislative and public review.
• Identify criteria for the successful reform or elimination of inefficient tax expenditures.
• Understand the political and administrative challenges of managing the 'hidden budget.'

• Budget Analysts and Fiscal Planners
• Officials in Ministry of Finance/Treasury (Budget and Revenue Departments)
• Legislative and Parliamentary Budget Office Staff
• Policy Evaluation and Program Review Specialists
• Tax Policy Analysts and Economists
• Academics researching Fiscal Transparency
• Auditors and Financial Controllers

• Practical workshop on calculating tax expenditure costs using provided data.
• Group presentation of a cost-benefit analysis for a national tax provision.
• Drafting a section of an annual tax expenditure budget report.
• Discussions on the political hurdles in eliminating entrenched tax breaks.
• Scenario analysis of replacing a tax deduction with a direct cash grant.
• Peer review of policy briefs on fiscal transparency.

Unit 1: The Concept and Measurement of Tax Expenditures

• The normative tax system (benchmark) and deviations from it
• Official definitions of tax expenditures (IMF, OECD, and national standards)
• Distinguishing between structural features and genuine tax expenditures
• Types of tax expenditures: exclusions, deductions, deferrals, credits, and preferential rates

• The revenue-foregone method and its limitations
• The outlay-equivalent method and its application
• The concept of net tax expenditures and interactions between provisions
• Challenges in measuring complex or behavioral tax expenditures

Unit 2: Reporting and Budget Integration

• International best practices for annual tax expenditure reports
• Integrating tax expenditures into the standard government financial accounts
• Legislative and executive requirements for tax expenditure oversight
• Presenting tax expenditure data for public and legislative consumption

• Using tax expenditure analysis for fiscal policy transparency
• Comparing the cost of tax expenditures to direct spending programs
• Analyzing the distributional impact of tax expenditures (who benefits?)

Unit 3: Evaluation and Economic Impact

• Establishing clear objectives and performance indicators for tax expenditures
• Cost-effectiveness analysis (CEA) and cost-benefit analysis (CBA) techniques
• Assessing the behavioral response (elasticities) to tax incentives
• Leakage, deadweight loss, and unintended consequences of tax expenditures

• The role of tax expenditures in long-term fiscal sustainability
• Tax expenditures as a source of "structural deficit"
• Analyzing tax expenditures as part of the total public sector debt

Unit 4: Case Studies and Reform

• Expenditures in the corporate sector (e.g., R&D credits, accelerated depreciation)
• Expenditures in the personal sector (e.g., housing, health, education deductions)
• Analyzing the effectiveness of tax incentives for investment and innovation

• Identifying ineffective or inequitable tax expenditures for elimination
• Strategies and political economy of tax base broadening
• Converting tax expenditures into direct spending programs: pros and cons

Unit 5: Legal and Administrative Aspects

• Statutory requirements for review and sunset provisions
• The legal challenge of *entitlements* created by tax provisions
• Administrative challenges in data collection and program monitoring