Tax and Governance

There is mounting evidence that increased taxation can spur statebuilding and increase government accountability.  This possibility is critical: without strong links between taxation, statebuilding and accountability, expanded taxation may fail to deliver improved outcomes for taxpayers.  However, such links are far from guaranteed, and depend, among other things, on the types of taxes raised, the nature and equity of tax enforcement, the extent of transparency, the existence of forums for popular engagement and the role of civil society in supporting popular demand making.  The current phase of our research on this theme focuses on identifying concrete strategies for strengthening the links between taxation and good governance at both the local and national levels.

Publications:

April 2019
Colonial Legacy, State-building and the Salience of Ethnicity in Sub-Saharan Africa
by Merima Ali, Odd-Helge Fjeldstad, Boqian Jiang & Abdulaziz B Shifa

African colonial history suggests that British colonial rule may have undermined state centralisation due to legacies of ethnic segregation and stronger executive constraints. Using micro-data from anglophone and francophone countries in sub-Saharan Africa, we find that anglophone citizens are less likely to identify themselves in national terms (relative to ethnic terms). To address endogeneity concerns,…

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December 2018
Taxing Government: The Case of the Uganda Revenue Authority’s Public Sector Office
by Henry Saka, Ronald Waiswa & Jalia Kangave

This ICTD Research in Brief is a two-page summary of ICTD Working paper 84 by Henry Saka, Ronald Waiswa and Jalia Kangave. This series is aimed at policy makers, tax administrators, fellow researchers and anyone else who is big on interest and short on time. In the past three decades, revenue authorities in African countries…

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November 2018
China’s Challenge to International Tax Rules and the Implications for Global Economic Governance
by Martin Hearson & Wilson Prichard

Twentieth century institutions of global economic governance face a profound challenge adapting to the rise of emerging markets and, especially, China’s rise. This is especially the case for the international tax regime, whose institutional home is the OECD and which is based on norms that favour capital exporting states. To understand the nature of the…

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September 2018
Does Fiscal Decentralization Enhance Citizens’ Access to Public Services and Reduce Poverty? Evidence from Côte d’Ivoire Municipalities in a Conflict Setting
by Tiangboho Sanogo

Fiscal decentralization has been implemented in many countries with an explicit objective of improving public service delivery and reduce poverty. However, its effectiveness in achieving these goals are much debated and the empirical literature has mostly focused on poverty reduction using cross-country analysis. This paper analyses whether, and how, the devolution of revenue raising responsibilities…

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What Explains the Recent Calls for Reinstatement of a Tax Considered Unpopular? An Analysis of Graduated Tax in Uganda
by David.J Bakibinga, Jalia Kangave & Dan Ngabirano

This ICTD Research in Brief is a two-page summary of ICTD Working Paper 79 by David J Bakibinga, Julia Kangave and Dan Ngabirano. This series is aimed at policy makers, tax administrators, fellow researchers and anyone else who is big on interest and short on time. Graduated tax became unpopular for a variety of reasons….

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June 2018
Tax Reform for Low Income Countries: Five Ideas for Simplifying Tax Systems to Fit Local Realities
by Wilson Prichard & Mick Moore

There is no silver bullet to strengthen the tax systems of low-income countries. Dramatic changes in tax systems and tax collection are rare. Successful improvements more often involve a great deal of hard and steady work, and the gradual construction of popular trust and (grudging) support for reform. There remains, however, space for ‘organising ideas’…

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June 2018
Chapter 13: Taxation and Development
by Mick Moore

In The Oxford Handbook of the Politics of Development, two of America’s leading political scientists on the issue, Carol Lancaster and Nicolas van de Walle, have assembled an international cast of leading scholars to craft a broad, state-of-the-art work on this vitally important topic. Chapter 13, written by Mick Moore, explores the impact of taxation on politics…

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Tax in Development: Towards a Strategic Aid Approach
by Olav Lundstøl

Raising a higher share of the value added in an economy for the public purpose is associated with state building, modern economic growth and development. From 2002-3 to date, low- and lower-middle income countries raised total tax and non-tax revenue from 11-12 per cent and 18-19 per cent of GDP up to 17-18 per cent…

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Taxing Africa: Coercion, Reform and Development
by Mick Moore, Wilson Prichard & Odd-Helge Fjeldstad

Taxing Africa is an accessible and comprehensive introduction to the crucial debates around taxation and development in Africa. Taxation has been seen as the domain of charisma-free accountants, lawyers and number crunchers – an unlikely place to encounter big societal questions about democracy, equity or good governance. Yet it is exactly these issues that pervade…

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What is the Role of Taxpayer Education in Africa?
by Giulia Mascagni & Fabrizio Santoro

The ICTD’s African Tax Administration Papers (ATAPs) are research papers that will be of specific interest to people working in tax administration in Africa. This paper, the first in the new ATAP series, reviews existing initiatives on taxpayer education in Africa, an area that has been largely under-researched in the literature. We start by providing…

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Blogs:

March 2019
by Neil McCulloch & Tom Moerenhout

Nigeria’s performance on collected taxes is poor. Non-oil revenue in the country is around 3-4 percent of GDP, far below countries such as South Africa and Brazil where non-oil revenues lie between 20 and 25 percent of their GDP – or other peers in sub-Saharan Africa who typically collect more than 10 percent of GDP…

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March 2019
by Wilson Prichard

Recent years have seen surging international interest in strengthening tax collection in order to finance national development programs. Yet, despite evidence of high and frequently rising inequality across much of the developing world, strengthening the equity of tax systems has usually been low on the agenda. This in part reflects a technical debate: if the…

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December 2018
by Mick Moore, Odd-Helge Fjeldstad & Wilson Prichard

Over the past decade, international attention has increasingly focused on the potential contribution of taxation to improved development outcomes. In our recent book, Taxing Africa: Coercion, Reform and Development, we offer an overview of these issues and challenges in Africa.  A major objective of the book is to highlight major political questions about taxation in Africa,…

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Research Projects:

Current Project
Tax Collection and Bureaucrat Accountability: Experimental Evidence from the DRC
Project Researchers: Laura Paler, Augustin Bergeron, Gabriel Tourek & Jonathan L Wiegel

Taxation is thought to stimulate participation and accountable governance. This project examines how tax collection affects local bureaucrat performance in the DRC. We exploit random variation in whether local bureaucrats known as avenue chiefs were responsible for property tax collection (treatment), or whether agents of the tax ministry collected taxes within chief jurisdictions instead (control)….

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Current Project
Mining Taxation – Fondation pour les Etudes et Recherches sur le Développement International (FERDI)
Project Researchers: Celine De Quatrebarbes, FERDI

The Ferdi will update the legal and tax database country by country. It estimates that the average time needed to update a country is four days. However, it goes without saying that countries that have made major tax reforms will require more time than countries whose laws have not changed. For example, Burkina Faso, which…

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Current Project
Energy-related Tax Expenditures in Africa
Project Researchers: Dr. Neil McCulloch & Dr. Roel Dom

This project will explore the scope and size of energy-related tax expenditures in Africa. Tax expenditures (including rate reductions, exemptions and other forms of foregone revenue) can significantly reduce the overall revenue received by African governments. The literature on energy subsidies suggests that energy-related tax expenditures are often among the largest forms of revenue loss….

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