Progressive yet unfair: the case of informal taxes in the education sector in the DRC
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IOB Discussion paper 2025.02
This study questions the ‘stylized fact’ (Olken & Singhal, 2011) that informal taxes are redistributive yet regressive by analyzing the redistributive nature of informal taxes in the education sector in the DRC. Although it has been argued that informal taxes, like other indirect taxes, are regressive since they disproportionately affect low-income families, we
find that informal taxes are progressively distributed in the case of education sector in the DRC, with the 20% richest households paying four-fifths of the total tax burden in the sector.
Although being progressive in the income space, informal taxation cannot be considered ‘fair’ or ‘equitable’ however: the richer households are financing a disproportionally higher part of total education costs, both because children of poorer households drop out of school earlier and because richer households can pay for higher quality schools. The redistributive nature of informal taxes disappears after controlling for both effects.
Bienvenu Matungulu is a PhD student in Economics and Development jointly organised by the Catholic University of Bukavu and the University of Antwerp (Institute of Development Policy). After completing his degree in Rural Economics at the Catholic University of Bukavu, he went on to postgraduate studies in Management and Evaluation of Development Projects/Policies, culminating in a master's degree in 'Development, Evaluation and Management'. He is passionate about the question of state formation and inequalities.
Tom De Herdt studied political and social sciences and economics. His research focuses on the domains of poverty alleviation, capabilities, local governance and practical norms. He has published mainly on poverty, regress and development in Congo-Kinshasa but has also done some work on Nicaragua, Rwanda and Cameroon. He is currently focusing his research and policy advisory work on local aspects of public action in DRC.
Kamala Kaghoma has a Ph.D in Economics from Université de Yaoundé II-Soa with majors in Econometrics and Environmental economics. He is currently working with the faculty of Economics and Management of the Université Catholique de Bukavu (UCB) where he has been teaching for more than a decade now. Kamala’s main areas of research include Public Economics, Environmental Economics, Human resources Economics, Development microeconomics, Applied Macroeconomics, Applied econometrics and research methodology. His work focuses on child welfare related to water and sanitation access, poverty dynamics, social mobility and intergenerational (multidimensional) welfare transmission with emphasis on African countries. He is currently working on several issues like the role of social networks with regards to the management of natural resources, youth employment, entrepreneurship and internal migration and post-exploitation dynamics of restoration of artisanal mining sites in the Democratic Republic of the Congo (DRC). Kamala Kaghoma has conducted field researches and surveys in DRC and has some consultancy experience in Africa.
Citation: Matunfulu, B.; De Herdt, T. and Kaghoma, K.C. (2026) Progressive yet unfair: the case of informal taxes in the education sector in the DRC, IOB Discussion Paper / 2025.02
