The Political Economy of Taxation in Somalia: Historical Legacies, Informal Institutions, and Political Settlements
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Research in Brief 157
Despite significant externally driven efforts to strengthen the reach of the state in recent years, the government of Somalia still has one of the weakest tax capacities in the world, with a tax-to-GDP ratio of about 2 per cent. Many accounts of the tax challenges facing Somalia start with reference to the collapse of the state in 1991, and focus on the conflict and instability that followed. In this paper we draw attention to the historical legacies of weak taxation that predate recent conflict, and analyse the broader political economy of conflict and taxation that limit both the state’s capacity and will to tax. Top-down or technocratic institution-building is destined to fail if it does not take into account these political economy dynamics, and transform underlying political and social relations, and informal institutions.
Vanessa van den Boogaard is a Research Fellow at ICTD and a Senior Research Associate at the Munk School of Global Affairs and Public Policy at the University of Toronto. She completed her PhD thesis on informal revenue generation and statebuilding in Sierra Leone, and has ongoing research on the topic in the Democratic Republic of the Congo, Ghana, and Somalia. Vanessa co-leads ICTD's research programme on informality and tax.
Najibullah Nor Isak is the Director of the Customs Department at the Ministry of Finance in Somalia. Prior to this role, he led the Tax Policy Division, contributing to the design and implementation of key fiscal and tax policy reforms. He is an economist and researcher specialising in tax, revenue mobilisation, and fiscal policy. Formerly, he was a World Bank scholar at the National Graduate Institute for Policy Studies in Japan.
Citation: van den Boogaard, V. and Nor Isak, N. (2025) The Political Economy of Taxation in Somalia: Historical Legacies, Informal Institutions, and Political Settlements, ICTD Research in Brief 157, Brighton: Institute of Development Studies, DOI: 10.19088/ICTD.2025.025
