Heterodox Taxes: The Good, the Bad, and the Ugly

Abstract

Innovations in the design of certain taxes, analyzed in other parts of this book, demonstrate that the frameworks for a good tax do not have to be imported from developed countries. This does not mean that all new taxes are good, nor does it mean that there is a “black list” of bad taxes. As is always the case with tax issues, adopting a tax implies a compromise between sometimes competing objectives. Thus, enacting and administering a tax is not simply a matter of collecting more revenues, but also of taking into account the effects—good and bad—that the taxes could have on various aspects of development such as equity, efficiency, macroeconomic stability, and environmental sustainability.