2. Despite increasing user charges, it will still be necessary to impose general taxes in order to finance public goods that benefit the citizenry at large. Administrative feasibility and better tax administration should be basic concerns of any tax reform. Reforms are possible that will raise revenue while reducing economic distortions and the burden on the poor, although some tradeoffs among objectives remain unavoidable. Simplicity in design is essential, particularly for developing countries which have severely limited administrative resources. A reformed system will typically include: more streamlined company and personal income taxes; a value added tax (for ease of administration, often at the manufacturer's level only); and a few excise taxes on luxury or socially undesirable goods. If import duties are deemed necessary, these should be low and more uniform and marginal tax rates should also be low so as to minimize distortions and to promote compliance. Taxes should be simply structured, with few rates and few exemptions. Extensive use of tax incentives is undesirable since it severely complicates tax administration and rarely achieves the desired social goal but rather creates or exacerbates economic distortions. Tax on the poor can be reduced while at the same time concentrating administrative resources where they are most productive in raising revenue by implementing high threshold exemptions in individual income tax and exempting unprocessed products from VAT.