02169cas a2200241 a 4500 AALejournalIMF006087 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451873627 1018-5941 BD-DhAAL BD-DhAAL Farhan, Nisreen. Sao Tome and Principe : Domestic Tax System and Tax Revenue Potential / Nisreen Farhan. Washington, D.C. : International Monetary Fund, 2009. 1 online resource (40 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Sao Tome and Principe is very open and highly depends on imports resulting in high indirect tax revenue. At the same time, the production and export base are very narrow, leaving the authorities with a small domestic tax base. For these reasons, the country compares unfavorably with neighboring economies and other island countries, in terms of domestic revenue in percent of GDP. The paper describes the domestic tax system in Sao Tome and Principe and uses cross-country empirical analysis to reach a benchmark tax potential for the country. The paper reaches the conclusion that whether Sao Tome and Principe becomes an oil producer or not, it is more sustainable for it to rely on non-oil domestic revenue-a less volatile and less exhaustible resource-to finance current expenditures. To meet the country's increasing development and social objectives, the authorities need to mobilize sufficient domestic resources. The paper offers a number of fiscal reforms to reach this goal, including implementation of the new tax laws, reduction of exemptions, tax system reforms, and improvement of the tax administration. Mode of access: Internet IMF Working Papers; Working Paper ; No. 2009/215 Full text available on IMF http://elibrary.imf.org/view/journals/001/2009/215/001.2009.issue-215-en.xml IMF e-Library