Publication Date
Developing a tax system which limits tax evasion is a key challenge for many emerging markets. This column argues that introducing a flat tax as a boost to the post-war recovery in Ukraine is feasible if such a reform can sustain fiscal neutrality. A similar reform in Bulgaria has achieved the desired goal of enlarging the tax base by limiting the size of the informal economy. The flat tax reform is considered fair since, in a progressive tax regime, rich individuals and large companies often take advantage of available loopholes and exceptions to avoid paying any tax at all.
