Barriers to increasing tax revenue in developing countries

This review examines 4 reasons why tax systems do not yield higher revenues in many developing countries

From:
Department for International Development
Published
8 March 2017
Document Type:
Thematic Summary
Theme:
Economic Growth, Governance and Conflict
Authors:
Mills, L

Abstract

A brief review of the literature, informed by comments from a range of tax specialists, suggests 4 principal groups of reasons why tax systems do not yield higher revenues in many developing countries:

  1. Internal political factors
  2. Administrative constraints
  3. External political factors: multinational companies and other investors
  4. The structure of developing country economies

However, the issues involved are complex, and simple and direct answers do not exist.

K4D helpdesk reports provide summaries of current research, evidence and lessons learned. This report was commissioned by the UK Department for International Development.

Citation

Mills, L. (2017). Barriers to improving tax capacity. K4D Helpdesk Report. Brighton, UK: Institute of Development Studies.

Barriers to increasing tax revenue in developing countries

Published 8 March 2017
Contents