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Going Where the Money Is: Strategies for Taxing Economic Elites in Unequal Democracies

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  • Fairfield, Tasha

Abstract

How can policymakers circumvent obstacles to taxing economic elites? This question is critical for developing countries, especially in Latin America where strengthening tax capacity depends significantly on tapping under-taxed, highly-concentrated income and profits. Drawing on diverse literatures and extensive fieldwork, the paper identifies six strategies that facilitate enactment of modest tax increases by mobilizing popular support and/or tempering elite antagonism. Case studies from Chile, Argentina, and Bolivia illustrate the effect of these strategies on the fate of tax reform initiatives. The analysis builds theory on tax politics and yields implications for research on reform coalitions and gradual institutional change.

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  • Fairfield, Tasha, 2013. "Going Where the Money Is: Strategies for Taxing Economic Elites in Unequal Democracies," World Development, Elsevier, vol. 47(C), pages 42-57.
    • Handle: RePEc:eee:wdevel:v:47:y:2013:i:c:p:42-57
    DOI: 10.1016/j.worlddev.2013.02.011
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    7. Schützhofer, Timm B., 2016. "Ecuador’s fiscal policies in the context of the citizens’ revolution: a ‘virtuous cycle’ and its limits," IDOS Discussion Papers 15/2016, German Institute of Development and Sustainability (IDOS).
    8. Tasha Fairfield, 2015. "La economía política de la reforma tributaria progresiva en Chile," Revista de Economía Institucional, Universidad Externado de Colombia - Facultad de Economía, vol. 17(32), pages 129-156, January-J.
    9. John Gerring & Lee Cojocaru, 2016. "Selecting Cases for Intensive Analysis," Sociological Methods & Research, , vol. 45(3), pages 392-423, August.
    10. von Haldenwang, Christian, 2020. "Digitalising the fiscal contract: An interdisciplinary framework for empirical inquiry," IDOS Discussion Papers 20/2020, German Institute of Development and Sustainability (IDOS).
    11. von Schiller, Armin, 2015. "Party System Institutionalization and Reliance on Personal Income Tax in Developing Countries," IDB Publications (Working Papers) 7351, Inter-American Development Bank.
    12. Ivar Kolstad & Arne Wiig & Odd‐Helge Fjeldstad, 2021. "Citizens’ preferences for taxation of internationally mobile corporations: Evidence from Tanzania," Review of Development Economics, Wiley Blackwell, vol. 25(2), pages 548-562, May.

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