The impact of indirect tax on income distribution and poverty in Tanzania

Maskaeva, Asiya; Bochkaeva, Zanda; Mmasa, Joel; Msafiri, Mgeni

doi:10.1111/apce.12319

Cited by 2 publications

(2 citation statements)

References 11 publications

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“…In the same vein, Gupta and Jalles (2020) opined that tax revenues lead to a better distribution of income. Mmaskaeva et al (2021), reviewed the effects of indirect tax revenues on income distribution and poverty and concluded that during the first reform, indirect tax revenues have a neutral effect on income distribution and poverty. Nevertheless, under the second reform, indirect tax revenues have a positive effect on income distribution and poverty.…”

Section: -Literature Reviewmentioning

confidence: 99%

Tax Revenues and Income Inequality in Sub-Saharan Africa: Evidence from a Dynamic Panel Threshold Analysis.

AZENG,

HELGATH

2023

Preprint

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The main goal of this paper is to revisit the relationship between tax revenues and income inequality in 28 Sub-Saharan countries from 2000 to 2015. Applying a dynamic panel threshold model, the results find that that there is a nonlinearity link between both variables and an optimal tax revenue rate affecting income inequalities. More specifically, the optimal tax revenue rate is around 1.051%. Below this threshold, an increase of 1 percent in tax revenue rises income inequality by 0.017% and beyond this threshold, an increase of 1 percent in tax revenue reduces income inequality by 0.026%. by remaining below the optimal threshold, the authorities deprive themselves of a broadening of the tax base, lever in the fight against inequalities and poverty. Code JEL : C36, E62, 023.

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Section: -Literature Reviewmentioning

confidence: 99%

Tax Revenues and Income Inequality in Sub-Saharan Africa: Evidence from a Dynamic Panel Threshold Analysis.

AZENG,

HELGATH

2023

Preprint

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“…Overall, considering the gendered impact of consumption taxes is not straightforward. It requires an understanding of the overall progressivity of the tax and redistributive system, and a recognition that such taxes are often an important source of revenue for governments (Maskaeva et al 2021). Accordingly, analyses need to consider not just the stand-alone burden of indirect taxes, but also their contribution to government spending and social protection transfers, which in turn may promote gender equality (see, e.g., Ambel et al 2022).…”

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confidence: 99%

Engendering Taxation: a Research and Policy Agenda

Joshi,

Kangave,

van den Boogaard

2024

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Increased attention has been paid to the gender dimensions of taxation in recent years, though there has been limited research on the subject – particularly in lower-income contexts. Understanding how tax policies might affect women in lower-income countries is important at the current time, when governments are looking for new ways to increase domestic revenue – particularly through expanding the tax base. Given that women have historically represented only a small part of the formal workforce in these contexts, a shift towards indirect taxes and taxing the informal economy are likely to have a disproportionate effect on poorer households, and women in particular. Understanding whether, and in what specific ways, tax policy in lower-income countries affects the ability of women to participate in the workforce and carry out their caring responsibilities within households is critical for ensuring development with gender justice. This paper reviews the existing literature and related debates on gender and tax in lower income countries. It identifies knowledge gaps, and maps broader issues that are relevant for understanding the gendered impact of taxation. The paper makes four broad observations. First, existing research focuses on formal direct taxes that are less relevant for women in lower-income contexts, given their high participation rates in the informal economy. Instead, presumptive taxes, user fees and informal taxes place a disproportionate burden on low income women. Second, there needs to be greater attention paid to the ways in which women in senior and junior positions in tax administration can affect how taxpayers interact with tax authorities. Third, any assessment of tax policy’s impact on gender needs to consider revenue and expenditure together to ensure that the positive effects of tax policies are not undermined by budgets, or vice versa. Finally, we show that there has been insufficient gender-disaggregated data collection and analysis, which is required to draw generalizable conclusions about the gendered impact of tax policy. We argue that tax specialists need to think about research questions that address these gaps, and simultaneously address methodological challenges by gender disaggregation in data collection, as well as impact evaluation of tax policy implementation and innovation. Our overall conclusions are that tax policies can be made gender-neutral by paying careful attention to where they affect women differentially. There are opportunities for governments to explore policies that positively discriminate as a way to address structural gendered inequities. At the same time we recognise that, barring a few exceptions, tax policy and administration is often an unwieldy instrument to address gender equity directly. Instead other policies relating to labour markets, social protection and public services are better placed to be gender-transformative.

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The impact of indirect tax on income distribution and poverty in Tanzania

Cited by 2 publications

References 11 publications

Tax Revenues and Income Inequality in Sub-Saharan Africa: Evidence from a Dynamic Panel Threshold Analysis.

Tax Revenues and Income Inequality in Sub-Saharan Africa: Evidence from a Dynamic Panel Threshold Analysis.

Engendering Taxation: a Research and Policy Agenda

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