Management of tax expenditures: a study of the Indian case

Abstract

onsidering the extensive use which policy makers in India make of the instrument of tax expenditures, what is needed is proper management of all tax expenditures. Four points are involved here. The first is concerned with identifying tax expenditures. In order to identify tax expenditures, one will have to take a careful look at the various provisions in a tax law. Not all provisions allowing exemptions, deductions, etc. constitute tax expenditures. It is only special provisions in a tax law which constitute tax expenditures. These special provisions really have nothing to do with the essentials of a tax, nothing to do with shaping the structural framework necessary to operate a tax. Instead, they are methods of spending government funds.