The Alliance for Progress was a program intended to stimulate and aid the economic development of the peoples of Latin America. It proposed that the United States and nineteen Latin American republics pool financial and technical resources to aid the peoples of all these republics in achieving better living standards, greater human dignity, and increased political freedom. Although achievement of these goals depended partially upon the availability of external assistance, it depended even more upon the ability and willingness of the Latin Americans themselves to make numerous far-reaching institutional reforms within their countries.

One of the most important needs was in the area of tax reform, which had been made a quid pro quo for the twenty billion dollars promised by the United States through the program. This limitation upon the use of United States funds made obvious the need for a means of evaluating the adequacy of Latin American tax-reform efforts. In this study Raynard M. Sommerfeld presents an examination of this problem and recommends basic criteria for such evaluation. The study reviews the objectives of the Alliance for Progress, investigates the prevailing tax systems in the Latin American republics, and offers recommendations for tax-reform efforts to harmonize tax policy with the economic development goals stipulated in the Charter of Punta del Este.

The author emphasizes and reiterates the fact that thorough studies of the individual countries are necessary for the planning of truly adequate tax reform. He offers the facts developed in his study as interim tools for United States Alliance for Progress agencies in evaluating Latin American tax-reform efforts, for Latin American planners seeking to guide their countries most easily on the road to economic maturity, and for all scholars, teachers, and students interested in the fields of Latin American economics, taxation, and political history.

• Preface
• 1. An Introduction
  • The Alliance for Progress
  • Objectives of This Monograph
  • The Literature
• 2. The Objectives of Alliance-Prompted Tax-Reform Efforts
  • Review of the Basic Documents
  • Further Pronouncements on Tax Reform
  • A Closer Look at the Intended Objectives
  • Summary
• 3. A Summary of the Current Latin American Fiscal Scene
  • Problems in International Comparisons of Public Finance Statistics
  • The Level of Taxation
  • Relative Importance of Direct and Indirect Taxes
  • Details of the Tax Structure
  • Tax Sharing in Latin America
  • The Earmarking of Tax Revenues
  • Summary
• 4. Income Taxation
  • Problems in Income Taxation
  • Preconditions for Successful Income Taxation
  • Distinguishing Features of Some of the Latin American Income-Tax Codes
  • A Comparative Analysis of Income Taxation in Mexico and Venezuela
  • Summary
• 5. Wealth Taxation
  • Net-Wealth Taxation
  • Death and Gift Taxation
  • Real-Property Taxation
  • Summary
• 6. Other Taxes
  • Sales Taxes
  • Excise Taxes
  • Customs Duties
  • Miscellaneous Taxes
  • Summary
• 7. Tax-Exemption Schemes
  • The Role of Tax Exemption in Development Planning
  • Industrial-Tax Exemption in Mexico and in Puerto Rico
  • The Advantages of Tax-Exemption Schemes
  • The Limitations of Tax-Exemption Schemes
  • Conclusion
• 8. Tax Administration
  • Legal Factors
  • Accounting Considerations
  • Personnel Policies
  • Administrative Techniques
  • Tax Enforcement
  • Summary
• 9. Findings and Recommendations
  • Findings
  • Recommendations
• 10. An Epilogue
  • The Level of Taxation
  • More Progressive Taxation
  • Other Tax-Related Reform Efforts
  • Summary
• Appendices
  • 1. Resolutions of the United Nations Economic Commission for Latin America and the Inter-American Economic and Social Council of the Organization of American States Relative to the OAS/ECLA/IDB Taxation Program
  • 2. Joint Program on Taxation of the Organization of American States and the United Nations Economic Commission for Latin America, with the Participation of the Inter-American Development Bank and the Co-operation of Harvard University
• Bibliography
• Index