Peer-reviewed Papers

    A major component of tax administration reform in sub-Saharan Africa for the last 30 years has been the creation of semi-autonomous revenue authorities (SARAs). The effects of their creation on revenue performance have been much debated, although there are only a few quantitative studies. The core argument of this paper is that existing research suggesting diverse and contradictory outcomes has not taken account of trends in revenue performance in the years before the establishment of SARAs. Allowing for this revenue history, our analysis based on 46 countries over the period 1980-2015 provides no robust evidence that SARAs induce an increase in revenue performance. This does not imply that SARAs may not provide benefits for tax collection, but they do not demonstrably increase (or decrease) revenue collected.

Working Papers

    Economic sanctions, and the suspension of budget support in particular, are supposed to pressure target governments to comply with donors’ demands by putting spending commitments at risk. We argue that this is too simplistic since governments have more fiscal levers at their disposal. The case of Burundi illustrates this argument. Following Burundi’s 2015 political crisis, donors imposed economic sanctions on the country and suspended all budget support to the national government. Using monthly data on the government’s fiscal position between 2005 and 2017, we present evidence from a time series analysis showing that aid does not affect spending and that aid shortfalls are instead systematically compensated with domestic borrowing. It appears that the Burundian government has been able to withstand the sanctions and to fulfill its spending commitments by substituting domestic debt for aid. Thus, the economic costs of sanctions do not necessarily translate directly into political costs but are mitigated by the government’s fiscal response.

    Taxation is argued to lead to a bargain in which taxpayers trade off quasi-voluntary compliance for improved government accountability. Historical experiences in the West confirm this. However, for contemporary developing countries the validity of this argument is less clear, as their circumstances differ markedly from the ones encountered by Western nations in the past. Using new governance data, I test this hypothesis in a panel of 47 African countries from 1980 until 2015. I show that taxation and accountability are still positively linked. Total tax revenue, in contrast with non-tax revenue which proxies for resource rents, correlates positively with accountability scores. This effect is mainly driven by direct taxation. Instrumenting tax revenue, with terms of trade and exchange rate shocks, confirms the results. This suggests a causal interpretation for the relationship. A governance dividend from taxation is thus still possible.

Policy Papers

  • Reforming Tax Systems in the Developing World: The Past, Present and Future
    ODI Report
  • The Taxation of Foreign Aid: Don’t Ask, Don’t Tell, Don’t Know
    ODI Briefing Note
  • ICTD Research in Brief 18 – Semi-Autonomous Revenue Authorities in Sub-Saharan Africa: Silver Bullet or White Elephant
    ICTD Policy Brief
  • The Role of Domestic Revenue Mobilisation in Self-Financed Exit from Aid Dependence and Sustainable Development in Indonesia
    Synthesis Report