Informal taxation in Sierra Leone: Magnitudes, perceptions and implications

Boogaard, Vanessa van den; Prichard, Wilson; Jibao, Samuel

doi:10.1093/afraf/ady049

Cited by 19 publications

(22 citation statements)

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“…Second, while relying on informal taxation may help to fill gaps left by weak state capacity, it nevertheless has important equity and distributional implications, with evidence from diverse contexts, including Gedo, showing that informal taxation is often regressive (see e.g., Evans et al, 2020; Olken & Singhal, 2011; van den Boogaard et al, 2019; van den Boogaard & Santoro, 2021). Critically, donor requirements for community contributions in CDD programs often take into consideration levels of poverty overall (Wong, 2012), though not necessarily inequity within communities.…”

Section: Discussion: Co‐financing Cdd Through Informal Taxesmentioning

confidence: 99%

Co‐financing community‐driven development through informal taxation: Evidence from south‐central Somalia

Boogaard

Santoro

2022

Governance

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Community contributions are often required as part of community-driven development programs, with contributions encouraged through matching grants. However, little remains known about the impact of matching grants or the implications of requiring community contributions-also known as informal taxation. We explore this research gap through a randomized control trial of a matching grant program in Gedo region in south-central Somalia. We find that matching grants can increase informal taxation and serve as an effective means of delivering public goods.Moreover, we find that the program strengthened local government legitimacy, despite the local government playing no direct role in the program. These findings deepen our understanding of how matching grants may contribute to community-driven development in a context of weak institutional capacity, while pointing to potential complementarities between state and nonstate actors in governance and service provision, formal and informal institutions, and formal and informal taxation. | INTRODUCTIONCommunity-driven development (CDD) has long been embraced by international development partners as a means of delivering public goods and strengthening social capital and cohesion, particularly in fragile contexts. To receive external support, CDD projects often require co-

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Section: Discussion: Co‐financing Cdd Through Informal Taxesmentioning

confidence: 99%

Co‐financing community‐driven development through informal taxation: Evidence from south‐central Somalia

Boogaard

Santoro

2022

Governance

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“…Tax authorities assess earners of income in the informal sector—be they self‐employed individuals or larger businesses—based on estimated income and set a single flat tax for all, regardless of the real income earned. In a more recent study, van den Boogaard et al (2019) differentiate between statutory taxes such as presumptive taxation and other tax‐like payments and found taxpayer perceptions in Sierra Leone to be more positive towards tax‐like payments. Taxpayers, the authors suggest, were more likely to believe that the actor levying these payments would use them to deliver community benefits.…”

Section: An Inequality Approach To Taxing the Informal Sectormentioning

confidence: 99%

Do tax policies discriminate against female traders? A gender framework to study informal marketplaces in Nigeria

Akpan¹,

Cascant‐Sempere

2022

Poverty & Public Policy

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Scholars have long debated formalizing the informal sector through taxation, but how do these processes affect gender inequalities? Our study in Nigerian markets contributes a gender framework to the equitable taxation literature on formalization. The study draws on a survey of 451 traders in 12 markets, key informant interviews, and ethnographic research in four markets of two states. We find that in at least two situations taxation policies discriminated against women implicitly: (1) male tax collectors had higher incidences of harassment on all traders and (2) taxing traders with flat taxes penalized women, as they earned less than men but were taxed the same.

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“…Several researchers have alluded to the potential attainment of the revenue gains and the other advantages emanating from taxing the informal sector in African countries. For example in Zimbabwe (Dube & Casale, 2016;Ligomeka, 2019;Newman, 2019;Sebele-Mpofu, 2021), Nigeria (Meagher, 2018), Ethiopia (Bongwa, 2009), Kenya (Ndaka, 2017), Sierra Leone (Jibao, Prichard, & Van den Boogaard, 2017;Van den Boogaard, Prichard, & Jibao, 2019) and Zambia (Resnick, 2018(Resnick, , 2021. Even though taxing the informal sector is encouraged for sustainable revenue mobilisation in SSA, it is important to acknowledge that there are many challenges to be surmounted.…”

Section: Taxation Of the Informal Sectormentioning

confidence: 99%

Sustainable mobilisation of tax revenues to enhance economic growth in Sub-Saharan Africa: Challenges, opportunities, and possible areas of reform

Mpofu

2022

IJRBS

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Domestic revenue mobilisation is fundamental if African countries are to fund investments in health, education, infrastructural development, economic growth, human capital development, security, and prosperity to attain the Sustainable Development Goals by 2030. Some goals focus on eradicating poverty, reducing inequalities, strengthening institutions, and providing decent work. This requires resources and investment, yet Sub-Saharan African countries continuously struggle to mobilise enough revenue to meet basic government objectives. Through a critical literature review, this paper focuses on sustainable tax revenue mobilisation in Sub-Saharan African Countries, discussing the challenges, opportunities, and prospects for possible amelioration of tax systems. Challenges identified to explain the ineffectiveness of revenue mobilisation in these countries include the presence of a significant informal sector, weak tax administration capacities, the growth in the digital economy, corruption, governance quality, and increased tax avoidance and evasion by multinational companies. Possible prospects include taxation of the digital economy, taxing the informal sector, the capacitation of tax authorities, and the broadening of tax bases.

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Informal taxation in Sierra Leone: Magnitudes, perceptions and implications

Cited by 19 publications

References 0 publications

Co‐financing community‐driven development through informal taxation: Evidence from south‐central Somalia

Co‐financing community‐driven development through informal taxation: Evidence from south‐central Somalia

Do tax policies discriminate against female traders? A gender framework to study informal marketplaces in Nigeria

Sustainable mobilisation of tax revenues to enhance economic growth in Sub-Saharan Africa: Challenges, opportunities, and possible areas of reform

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