Tax effort performance in sub-Sahara Africa and the role of colonialism

Feger, Thuto and Asafu-Adjaye, John (2014) Tax effort performance in sub-Sahara Africa and the role of colonialism. Economic Modelling, 38 163-174. doi:10.1016/j.econmod.2013.12.020


Author Feger, Thuto
Asafu-Adjaye, John
Title Tax effort performance in sub-Sahara Africa and the role of colonialism
Journal name Economic Modelling   Check publisher's open access policy
ISSN 0264-9993
1873-6122
Publication date 2014-02-01
Sub-type Article (original research)
DOI 10.1016/j.econmod.2013.12.020
Volume 38
Start page 163
End page 174
Total pages 12
Language eng
Formatted abstract
Highlights
• Tax revenue collection in sub-Sahara Africa has been historically low.
• This paper explains variations in tax effort performance amongst SSA countries.
• We find that historical events help to explain such variations.
• The different colonial policies pursued in SSA have affected tax revenue performance.

Governments in sub-Sahara Africa (SSA) have tended to rely unduly on foreign aid and debt financing for the provision of public goods such as health, basic education and infrastructure. Domestic tax revenue could play a significant role in funding such expenditures. However, to date tax revenue collection in SSA has only averaged about 15% of GDP. In this paper we employ cluster analysis to enhance our understanding in the variations in tax effort performance amongst SSA countries. Past studies of tax effort performance in SSA have resorted to economic events or factors to explain the tax effort performance. We argue here that it is necessary to consider historical events to provide a fuller explanation. We provide evidence to show that the different colonial policies pursued in SSA have had a long lasting and profound effect on the countries' tax revenue performance.
Keyword Tax effort
Tax revenue performance
Sub-Sahara Africa
Colonialism
Q-Index Code C1
Q-Index Status Confirmed Code
Institutional Status UQ

Document type: Journal Article
Sub-type: Article (original research)
Collections: Official 2015 Collection
School of Economics Publications
 
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Created: Tue, 28 Jan 2014, 21:24:13 EST by Alys Hohnen on behalf of School of Economics