Taxation of Microfinance Institutions

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Microfinance > Best Practices > Taxation of Microfinance Institutions

Taxation of Microfinance Institutions
BCD OCANSEY, Manager, Ghana, Member
I have been thinking about whether microfinance enterprises - i.e. companies and business organisations that give small loans to the poor to finance their businesses - should pay tax. Why should they pay or not pay tax? If they should, how much tax should they pay? Should they be given any tax incentives? I'd like some members to share experiences in other countries. Thank you... (...) Read more? Sign up for free

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  Mincrofinance Institutions (MFI) Should not Be Taxed
Charles Tanyi, Student (Other), Cameroon, Member
  In Cameroon they are taxed. Indeed, it is the poor who are being taxed, because the taxes are incurred by clients when they pay for the service the MFI provides to them.
This is the paradox. MFIs shoud actually be alleviating poverty. Unfortunately, the loans they give to the poor are heavily taxed and the very purpose of the loan is defeated.
No doubt, MFIs provide loans to the poor which they otherwise would not get from classical banks. Yet, the expected results are difficult to obtain because in the final analyses, the loans are more expensive than those granted by banks.
I hold therefore that MFIs should not be taxed if they are to meet a major objective which is poverty alleviation for the masses.

   
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Microfinance
Summary
Forum
🔥PROs and CONs of Microfinance: An Overview
Problems with Microfinance: Beneficiaries Lack Financial Expertise
Microfinance Types: Group and Individual Lending
Best Practices
🥇What is Financial Inclusion?
🥈Accreditation in Microfinance / Financial Inclusion
🥉Disadvantages of Microfinance / Microloans. Risks
What is Poverty Reduction in Development Economics?
History of Microfinance
Microfinance Counseling is Necessary
Middle Class is Key for Improving Quality of Life
Micro Financing Helps
Using Post Offices Towards Microfinancing
Micro Finance is for Business People
Recent Microfinance Trends
Micro Finance for Persons with Disabilities
Is Microfinance a Success?
Microfinance & Microcredit Need Kind-hearted People
Microfinance Needs Trust
During its Evolutionary Path, Microfinance is Getting More Expensive...
Microfinance Impact on Rural Development
Microfinance for Housing (MFH)
Microfinance Research and Intelligence
Non-interest Banking
Taxation of Microfinance Institutions
Influence of Economic Crisis on Microfinance
Management and Business Coaches Needed in Microfinance
Microfinance Challenge: Solvency of the Borrowers
Exclusion of Conventional Commercial Banks from Establishing Micro-finance Banks
What is the Best Way to Manage Microfinance in Sudan?


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