Tax Capacity and Growth

Gaspar, Ví­tor; Jaramillo, Laura; Wingender, Philippe

doi:10.5089/9781475558173.001

Cited by 50 publications

(50 citation statements)

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“…Initial tax ratios: Episodes of tax revenue mobilization occurred with both low and high initial tax-to-GDP ratios (Figure 7). Figure 7 presents the initial tax ratio also in relation to the "tipping point" of tax revenue, around 13 percent of GDP, after which countries tend to experience higher and sustained economic growth, as defined in Gaspar et al (2016a) and Gaspar et al (2016b). For…”

Section: Duration Of Episodesmentioning

confidence: 99%

See 1 more Smart Citation

Tax Revenue Mobilization Episodes in Emerging Markets and Low-Income Countries: Lessons from a New Dataset

Akitoby¹,

Baum²,

Hackney³

et al. 2018

IMF Working Papers

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How do countries mobilize large additions to tax revenue-defined as an average increase in the tax-to-GDP ratio of 0.5 percent per year over three years or more? To answer this question, we build a novel dataset covering 55 episodes of large tax revenue increases in low-income countries and emerging markets. We find that: (i) reforms of indirect taxes and exemptions are the most common tax policy measures; (ii) multi-pronged tax administration reforms often go hand in hand with tax policy measures; and (iii) sustainability of the episodes hinges on tax administration reforms in the key compliance areas (risk-based audits, registration, filing, payment, and reporting). JEL Classification Numbers: E62, H2

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Section: Duration Of Episodesmentioning

confidence: 99%

“…In recent years, there has been wider and renewed interest by many governments and multilateral institutions in enhancing tax capacity, stemming from the recognition that tax capacity is at the core of state building and development (Besley andPersson, 2009, 2010;IMF, 2011;Gaspar et. al, 2016aGaspar et. al, , 2016b.…”

Section: Introductionmentioning

confidence: 99%

Tax Revenue Mobilization Episodes in Emerging Markets and Low-Income Countries: Lessons from a New Dataset

Akitoby¹,

Baum²,

Hackney³

et al. 2018

IMF Working Papers

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“…A growing number of studies over the years have examined the effects of public capital/investment, and more recently, of taxation on economic growth (e.g. Alinaghi and Reed, 2017;Gaspar et al, 2016;Dackehag and Hansson, 2015;Macek, 2014;Fricke and Süssmuth, 2014;Attila, 2008;Arnold, 2008;Barro, 1991b). The most usual empirical approach is based on estimating growth regressions across a sample of countries, with either cross-section analyses or panel econometric techniques being applied.…”

Section: Review Of the Literaturementioning

confidence: 99%

Generation of Tax Revenues and Economic Development: A Panel-Analysis for Emerging Economies in Asia

Vogiatzoglou

Nguyen

2018

Review of Economic and Business Studies

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Particularly in an emerging or developing economy context, generating sufficient tax revenues is essential for the provision and upkeep of well-needed public infrastructure/public capital that supports the development process. However, tax policy can also cause distortionary and negative effects to economic activity and growth, especially if excessive taxation is imposed. The aim of this paper is to examine the role of tax revenues and estimate its overall net impact on economic growth in emerging economies in Asia. The dataset covers emerging economies from South, Southeast, and East Asia during 1998-2015. The results show that tax revenues have an overall positive net impact on the growth rate of real GDP per capita, suggesting the positive effects associated with taxation outweigh the negative and distortionary effects of taxation. Thus, evidence is found that the collection of adequate amounts of tax revenues (with which public investments were financed) contributed significantly to economic development.

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“…With broadly stable trend over the years, tax-to-GDP ratio remains far below the averages of non-resource-rich middle east and central Asia (MCD) countries, sub-Saharan Africa (SSA) countries, and countries with similar per capita income (Figure 3). Notably, Sudan has remained below the 12.75 percent of GDP "tax tipping point" identified by Gaspar et al (2016), while other regional averages have consistently been above that threshold.…”

mentioning

confidence: 93%

“…To achieve short-to medium-term macroeconomic stability as well as overcome key longterm developmental challenges, enhancing tax collection has always been one of the central themes particularly in low-income countries (LICs). Evidence from Gaspar et al (2016) confirmed a tax "tipping point" of about 12.75 percent of GDP, beyond which tax revenue enables a significant acceleration in economic growth. 2…”

mentioning

confidence: 98%

Sudan

2020

IMF Staff Country Reports

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This Selected Issues paper on Sudan provides a first stock-taking of the scale, main transmission channels and potential costs of poor governance and corruption in Sudan and offers preliminary recommendations. A large body of literature and country analyses confirm that weak governance and corruption undermine economic growth, amplify income inequality and erode public trust in the institutions. According to international agencies and existing literature, Sudan has scored very poorly on compliance with rule of law best practices in the past. Effective implementation of preventive measures is important; particularly in relation to politically exposed persons. Transparency on beneficial ownership of legal persons and arrangements to prevent their misuse for laundering the proceeds of corruption are necessary. Transparency, accountability, and comprehensive communication should be the backbone of governance and anti-corruption reforms in each sector. Rationalizing tax exemptions and phasing out tax holidays would strengthen governance while boosting fiscal revenues.

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Tax Capacity and Growth

Cited by 50 publications

References 37 publications

Tax Revenue Mobilization Episodes in Emerging Markets and Low-Income Countries: Lessons from a New Dataset

Tax Revenue Mobilization Episodes in Emerging Markets and Low-Income Countries: Lessons from a New Dataset

Generation of Tax Revenues and Economic Development: A Panel-Analysis for Emerging Economies in Asia

Sudan

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