2018 International Monetary Fund Cover: IMF Multimedia Services Division Composition: AGS, An RR Donnelley Company Cataloging-in-Publication Data Joint Bank-Fund Library Names: International Monetary Fund. Title: Fiscal monitor. Other titles: World economic and financial surveys, 0258-7440 Description: Washington, DC : International Monetary Fund, 2009- | Semiannual | Someissues also have thematic titles. Subjects: LCSH: Finance, Public—Periodicals. | Finance, Public—Forecasting—Periodicals. |Fiscal policy—Periodicals. | Fiscal policy—Forecasting—Periodicals. Classification: LCC HJ101.F57 ISBN: 978-1-48433-3952 (paper)978-1-48434-9946 (ePub)978-1-48434-9977 (Mobi)978-1-48434-9724 (PDF) Disclaimer: TheFiscal Monitoris a survey by the IMF staff published twice a year, inthe spring and fall. The report analyzes the latest public finance developments, updatesmedium-term fiscal projections, and assesses policies to put public finances on a sustain- able footing. The report was prepared by IMF staff and has benefited from commentsand suggestions from Executive Directors following their discussion of the report onSeptember 21, 2017. The views expressed in this publication are those of the IMF staffand do not necessarily represent the views of the IMF’s Executive Directors or theirnational authorities. Recommended citation: International Monetary Fund (IMF). 2018.Fiscal Monitor:Capitalizing on Good Times.Washington, April. Publication orders may be placed online, by fax, or through the mail: International Monetary Fund, Publication Services P.O. Box 92780, Washington, DC 20090, U.S.A. Telephone: (202) 623-7430Fax: (202) 623-7201 E-mail: publications@imf imfbookstore elibrary.imfInternational Monetary Fund|April 2018iii <CT CONTENTS Assumptions and Conventions vii Further Information viii Preface ix Executive Summary x Chapter 1. Saving for a Rainy Day 1 Introduction 1 Recent Developments and Outlook 6 Advanced Economies: Resting on Laurels 11 Emerging Market and Middle-Income Economies: Progress, but Not Enough 17 Low-Income Developing Countries: Vulnerabilities Drifting Upward 19 Risks to the Fiscal Outlook 21 Saving for a Rainy Day 22 Structural Fiscal Policies to Buttress Growth 24 Box 1.1. Private Debt and Its Discontents 30 Box 1.2. The Distributional Effects of Income Tax Cuts in the United States 32 Box 1.3. International Tax Policy Implications from US Corporate Tax Reform 34 Box 1.4. General Government Debt and Fiscal Risks in China 36 References 38 Chapter 2. Digital Government 43 Introduction 43 The Digital Transformation of Governments 44 What Governments Can Do Now: Same Policies, Better Implementation 47 Addressing New Challenges 58 What Stands in the Way: Lessons from Country Experience 62 Policy Implications and Conclusions 65 Box 2.1. Digitalization Advances in Revenue Administration in South Africa and Estonia 67 Box 2.2. Digitalization and Property Taxation in Developing Economies 69 Box 2.3. Digitalizing Government Payments in Developing Economies 71 Box 2.4. Using Real-Time Fiscal Data to Upgrade Macroeconomic Surveillance Systems 73 Box 2.5. Small Business Taxation and the P2P Economy 74 Annex 2.1. The Digitalization of Public Finances: Country Case Studies 76 Annex 2.2. Estimating the Impact of Digitalization on Tax Evasion from Cross-Border Fraud 80 Annex 2.3. Estimating the Distribution of Tax Revenue Collection from Offshore Income and Wealth following Improved Cross-Country Information Exchange 85 References 86 Country Abbreviations91 Glossary93 FISCAL MONITOR: CAPITALIZING ON GOOD TIMES ivInternational Monetary Fund|April 2018 Methodological and Statistical Appendix95 Data and Conventions 95 Fiscal Policy Assumptions 98 Defnition and Coverage of Fiscal Data 102 Table A. Economy Groupings 102 Table B. Advanced Economies: Defnition and Coverage ofFiscal MonitorData 104 Table C. Emerging Market and Middle-Income Economies: Defnition and Coverage of Fiscal MonitorData 105 Table D. Low-Income Developing Countries: Defnition and Coverage ofFiscal MonitorData 106 List of TablesAdvanced Economies (A1–A8) 107 Emerging Market and Middle-Income Economies (A9–A16) 115 Low-Income Developing Countries (A17–A22) 123 Structural Fiscal Indicators (A23–A25) 129 Fiscal Monitor,Selected Topics 133 IMF Executive Board Discussion Summary 141 FiguresFigure 1.1. General Government Debt 2 Figure 1.2. General Government Primary Balance 2 Figure 1.3. General Government Debt in 2017 Compared with Debt at Time of Fiscal Crises 3 Figure 1.4. General Government Debt Levels in 2017 and Debt Ceilings under Fiscal Rules 3 Figure 1.5. General Government Debt and Fiscal Stabilization 4 Figure 1.6. Distribution of Debt-to-GDP Ratios, 2000–17 8 Figure 1.7. General Government Debt in Countries That Received Debt Relief under the Heavily Indebted Poor Countries Initiative 8 Figure 1.8. General Government Debt Including Implicit Liabilities from Pension and Health CareSpending, 2017 9 Figure 1.9. Low-Income Developing Countries: Interest Expense as a Share of Tax Revenue and Total Expenditure 10 Figure 1.10. Low-Income Developing Countries: Share of Nonconcessional Financing 10 Figure 1.11. Foreign-Currency-Denominated General Government Debt, 2017 11 Figure 1.12. Advanced Economies: General Government Net and Gross Investment in NonfnancialAssets, 2016 or Latest 15 Figure 1.13. Advanced Economies: Change in Primary Balance 15 Figure 1.14. Advanced Economies: Change in Total Expenditure, 2012–17 16 Figure 1.15. Emerging Market and Middle-Income Economies: General Government Revenue 18 Figure 1.16. Emerging Market and Middle-Income Economies: Change in Expenditure Categories,2012–17 18 Figure 1.17. Low-Income Developing Countries: Change in Expenditure Categories, 2012–17 20 Figure 1.18. Low-Income Developing Countries: Change in Government Secondary Education Spending and Outcome, 2012–15 20 Figure 1.19. Low-Income Developing Countries: General Government Revenue 20 Figure 1.20. Low-Income Developing Countries: General Government Debt, 2007–23 21 Figure 1.21. Real GDP per Capita Growth, 1970–2023 24 Figure 1.22. Value-Added Tax, Compliance, and Policy Gaps 25 。。。。。。