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Assessing the impact of tax administration reforms in Sub-Saharan Africa

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  • Mavungu, Marina Ngoma
  • Krsic, Nikolina

Abstract

This proposal investigates the impact of adopting tax reforms such as the Value Added Tax (VAT), the Large Taxpayers Unit (LTU), and the Semi-Autonomous Revenue Agency (SARA) on tax revenue performance revenues in Sub-Saharan Africa. Despite the increasing adoption of these reforms, the literature on tax reforms effectiveness in Sub-Saharan is controversial. This proposal adds to the debate by using an Ordinary Least Square Fixed effect model controlling for countries and years fixed effects as well as a set of relevant covariates. We use a panel dataset of 46 countries from 1980 to 2013 and show that, in contrast to existing findings, there is no robust evidence that the three tax reforms increased tax collection performance in Sub-Saharan Africa. We find that controlling for time fixed effects and relevant covariates removes the statistical significance of all the tax reforms. Therefore, we conclude that there is little statistical robustness to support a significance of these reforms on tax collection in Sub-Saharan Africa.

Suggested Citation

  • Mavungu, Marina Ngoma & Krsic, Nikolina, 2017. "Assessing the impact of tax administration reforms in Sub-Saharan Africa," MPRA Paper 89275, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:89275
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    References listed on IDEAS

    as
    1. Roel Dom, 2017. "Semi-Autonomous Revenue Authorities in Sub-Saharan Africa: Silver Bullet or White Elephant," Discussion Papers 2017-01, University of Nottingham, CREDIT.
    2. Taliercio, Robert Jr., 2004. "Administrative Reform as Credible Commitment: The Impact of Autonomy on Revenue Authority Performance in Latin America," World Development, Elsevier, vol. 32(2), pages 213-232, February.
    3. Christian EBEKE & Mario MANSOUR & Grégoire ROTA-GRAZIOSI, 2016. "The Power to Tax in Sub-Saharan Africa: LTUs, VATs, and SARAs," Working Papers P154, FERDI.
    4. Mario MANSOUR, 2014. "A Tax Revenue Dataset for Sub-Saharan Africa: 1980-2010," Working Papers I19, FERDI.
    5. Mr. Andrew M. Warner, 2015. "Natural Resource Booms in the Modern Era: Is the curse still alive?," IMF Working Papers 2015/237, International Monetary Fund.
    6. Ms. Maureen Kidd & William Joseph Crandall, 2006. "Revenue Authorities: Issues and Problems in Evaluating their Success," IMF Working Papers 2006/240, International Monetary Fund.
    7. Mr. Patrick Fossat & Mr. Michel Bua, 2013. "Tax Administration Reform in the Francophone Countries of Sub-Saharan Africa," IMF Working Papers 2013/173, International Monetary Fund.
    8. Mr. David Kloeden, 2011. "Revenue Administration Reforms in anglophone Africa Since the Early 1990's," IMF Working Papers 2011/162, International Monetary Fund.
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    Cited by:

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    More about this item

    Keywords

    Tax reforms; Tax collection performance; Ordinary Least Square Fixed effect model; Sub-Saharan Africa; VAT; LUT; SARA.;
    All these keywords.

    JEL classification:

    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • N47 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Africa; Oceania
    • O23 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Fiscal and Monetary Policy in Development

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