• Overall Progressivity
• Personal Income Tax
• Wealth Taxes
• Value Added Tax/Sales Tax
• Trade taxes
• Presumptive/Turnover Tax
• Corporate Income Tax

• Tax Revenues
• Revenues from Extractive Industries
• Tax Payers

• Organization
• Administration
• Resources
• Oversight

• Agriculture
• Education
• Healthcare

• Tax System Transparency
• Information Availability on Companies
• Audit
• Budget Documentation
• Citizens’ Engagement

• Governance
• Transparency

There is a lack of progressive taxation for both individuals and corporations with large incomes. Direct tax only made up 9% of total tax revenues in 2017, which makes the national tax system regressive of nature.

• Overall Progressivity
  0
• Personal Income Tax
  8
• Wealth Taxes
  2
• Value Added Tax/Sales Tax
  1
• Trade taxes
  10
• Presumptive/Turnover Tax
  8
• Corporate Income Tax
  2

Given the complex political and economic conditions of the region, the revenue structure poses a long-term risk to the fiscal sustainability of the Palestinian Authorities. Currently they are able to meet 82% of their total current expenditure.    

• Tax Revenues
  8
• Revenues from Extractive Industries
  3
• Tax Payers
  5

The overall operational effectiveness of the Palestinian tax system is satisfactory and improving over time in terms of administration costs and revenue shortfalls. However, improvements need to be made in terms of collection procedures, audit function, and tax avoidance and evasion.    

• Organization
  3
• Administration
  8
• Resources
  10
• Oversight

The security sector alone absorbs 29% of total public spending – equaling that of health and education combined. This has created widespread concern in Palestinian society over what is considered as ‘overspending on security’ at the expense of social services.    

• Agriculture
  0
• Education
  8
• Healthcare
  2

The administration of the tax system in Palestine still lacks sufficient transparency and accountability, and escapes effective institutional oversight. Companies and individuals often succeed, through designated accountants, in benefitting from loopholes in the tax system to pay lower taxes than they should.    

• Tax System Transparency
  3
• Information Availability on Companies
  10
• Audit
  3
• Budget Documentation
  10
• Citizens’ Engagement
  3

Palestina scores dramtically low on this area due to absence of information on the exemptions granted to industrial zone investors. The list of investors names is not available to the public, therefore it is not possible to ascertain whether they comply with the investment exemptions. Additionally, no financial reports on investment exemptions are published. 

• Governance
  4
• Transparency
  0