Tax exemptions for foreign aid-funded projects have been the subject of international debate since the mid-2000s, their elimination being frequently discussed but never implemented. This issue has now returned to the fore. First, many developing countries have embarked on reforms in the areas of tax policy and administration with a view to improving the efficiency of their general tax system. These efforts have made tax systems more acceptable, eliminating one of the main justifications for aid-related tax exemptions. Second, the International Conference on Financing for Development held in Addis Ababa in August 2015 emphasised domestic resource mobilisation as the high-priority source of development finance.

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