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Article

Kofi Kamasa, George Adu and Eric Fosu Oteng-Abayie

The purpose of this paper is to find the effect of quality of tax administration on firm productivity in Sub-Saharan Africa (SSA). Also, the paper investigates whether the…

Abstract

Purpose

The purpose of this paper is to find the effect of quality of tax administration on firm productivity in Sub-Saharan Africa (SSA). Also, the paper investigates whether the effect of quality of tax administration on firm productivity varies with respect to firms of different ages and sizes.

Design/methodology/approach

The paper uses the World Bank Enterprise Survey data for 6,718 firms across 40 countries in SSA. By employing the least square method, the estimations are robust since country and industry heterogeneity are controlled, as well as other covariates that affect firm productivity such as capital, technology, business environment, infrastructure and firm characteristics.

Findings

Results of the paper reveal that productivity of firms reduces with poor quality of tax administration. With positive and significant interaction term coefficient between smaller firms and quality of tax administration, the findings also reveal that smaller firms do benefit in the presence of poor quality of tax administration than larger firms.

Originality/value

The study contributes to policy by providing empirical evidence on the impact that quality of tax administration has on firm productivity. Empirically, the paper is also the first to assess the effect of tax administration quality on firm productivity with sole emphasis on SSA (to the best of the authors’ knowledge after review of literature). The paper suggests reforms and improvement in tax administration so as to reduce compliance burden and improve productivity.

Details

African Journal of Economic and Management Studies, vol. 11 no. 1
Type: Research Article
ISSN: 2040-0705

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Article

Dengjun Zhang

The purpose of this paper is to examine the impact of audit assurance on tax enforcement, which is represented by whether firms have been visited by tax officials and, if…

Abstract

Purpose

The purpose of this paper is to examine the impact of audit assurance on tax enforcement, which is represented by whether firms have been visited by tax officials and, if so, the total number of inspections per fiscal year. The efficiency of tax administration is further examined by whether it becomes a binding constraint to a firm’s operations.

Design/methodology/approach

The sample consists of 18,746 firm-year observations from 28 transition and market-based economies in Central-Eastern Europe. The binary logit model, the Poisson model and the ordinal logit model are applied to test the hypotheses.

Findings

The empirical results show that, while audit assurance does not reduce the probability of being visited by tax officials (regardless of visit times) for the two country groups, firms with audited financial reports meet tax officials less often in market-based economies but not in transition economies. Furthermore, only in market-based economies does audit assurance reduce the probability that tax administration becomes a severe obstacle to firms’ operations.

Originality/value

This study addresses the relationship between tax administration and audit assurance in market-based and transition countries. One implication of the empirical findings is that audit assurance would add benefits to business environments when countries evolve from transition to market-based economies.

Details

Journal of Accounting in Emerging Economies, vol. 9 no. 4
Type: Research Article
ISSN: 2042-1168

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Book part

Karen Boll

This chapter focuses on the use of outcome-based performance management systems within public administration. It reports two qualitative case studies from respectively the…

Abstract

This chapter focuses on the use of outcome-based performance management systems within public administration. It reports two qualitative case studies from respectively the Danish Tax and Customs Administration and the Swedish Tax Agency. Both of these administrations use outcome-based performance management systems to steer subsets of their administrative work. The chapter shows that the systems respond to broader demands for accounting for outcomes, yet, the systems also operate in very different ways. The Danish case shows a quantitative system which measures on a daily basis, the Swedish case shows a qualitative system which measures on a four to five-year basis. What is striking about both cases is that they balance meeting the demands for accounting for diffuse outcomes, with developing measurements that ‘fit’ local contingent concerns. While much of the current research on performance management systems in public administration is critical and stresses the downsides of such systems, this chapter shows that these systems should not always be assumed to be connected to gaming, strategic behaviour and/or reductionism. Instead, the performance management systems can be seen as attempts to reconcile and make ends meet in ‘post-bureaucratic’ organisations that are increasingly expected to account for rather diffuse and abstract outcomes and expected at the same time to steer and prioritise daily administrative work.

Details

Bureaucracy and Society in Transition
Type: Book
ISBN: 978-1-78743-283-3

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Article

Mohammed Abdullahi Umar and Abdulsalam Masud

This study aims to investigate the reasons for the large scale tax noncompliance prevalent in underdeveloped countries despite many years of information technology…

Abstract

Purpose

This study aims to investigate the reasons for the large scale tax noncompliance prevalent in underdeveloped countries despite many years of information technology (IT)-led tax administration reforms.

Design/methodology/approach

The study is based on in-depth interviews with 18 senior tax administration officials. Their experiences were used to construct a grounded theory to explain the constraint of IT in tackling the prevalent tax noncompliance in underdeveloped countries.

Findings

First, IT is not immune to the systemic corruption prevalent in many developing countries; hence, it is quickly compromised. Second, IT can be efficient in dealing with registered taxpayers but cannot deal with the overwhelming large numbers of operators in the informal sector. Third, E-tax administration, which is a hallmark of IT-led tax administrations in advanced countries, is very slow to catch up in developing countries. A computerized tax administration alone, as currently obtainable in developing countries, is not enough to engender large usage of e-filing. Businesses, especially small and medium-sized enterprises (SMEs), need IT infrastructure as well to align with tax administration. Unfortunately, basic IT infrastructure is yet to be available to a large section of SMEs in developing countries.

Research limitations/implications

Underdeveloped countries are diverse. This study is from a single country and there may be need to take note of other countries’ peculiarities. However, Nigeria constitutes a good case study.

Practical implications

There is need to reform the people and systems along with IT originality/value.

Originality/value

To the authors’ knowledge, this study is the first to explore this very important question and among the first to explore tax administrators’ perspectives.

Details

Accounting Research Journal, vol. 33 no. 2
Type: Research Article
ISSN: 1030-9616

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Book part

Lyubov I. Vanchukhina, Tatiana B. Leybert, Elvira A. Khalikova and Evgeny A. Shamonin

The purpose of this chapter is to show the topicality of reformation of the state tax system as an inseparable part of Russia’s digital economy.

Abstract

Purpose

The purpose of this chapter is to show the topicality of reformation of the state tax system as an inseparable part of Russia’s digital economy.

Approach

The main problems of state tax systems impossible to solve without information technology (IT) products and wide practical implementation of information technologies are shown. The authors also show problems of formation of legal and information environment in the tax sphere.

Findings

The results of the research show the role of information technologies in Russian tax administration system. In particular, analysis of the main elements of tax administration, implementation of which is impossible without information production, is performed, and the influence of information technologies on the observation of tax administration principles in Russia is determined.

Originality/value

Based on the experience of foreign countries in the sphere of information production of tax system, the Russian practice of implementation of the modern information technologies and solutions in the tax sphere is given and the initial results are analyzed.

Abstract

Details

Fighting Corruption in the Public Sector
Type: Book
ISBN: 978-1-84950-857-5

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Article

Somaya Ahmed Aly Abdel‐Mowla

This study aims to evaluate effects of tax system reforms on tax obstacles to investment in Egypt and tax evasion. It also aims to analyze differences in burden of tax

Abstract

Purpose

This study aims to evaluate effects of tax system reforms on tax obstacles to investment in Egypt and tax evasion. It also aims to analyze differences in burden of tax obstacles and extent of tax evasion among different types of enterprises after applying tax reforms.

Design/methodology/approach

The study uses data from Productivity and Investment Climate Surveys 2004 and 2008. A number of indices are constructed to measure incidence and severity of tax obstacles. Two indicators are constructed to estimate incidence and extent of tax evasion. The study adopts a descriptive analytical comparative approach to evaluate changes and differences in severity of tax obstacles, and their effects.

Findings

The results obtained show that tax reforms have resulted in a significant decrease in severity of tax obstacles. However, they are still major obstacles. The overall decrease hides differences in the burden of these obstacles. Reforms were not enough to address needs of small enterprises. The extent of tax evasion decreased. However, it is still a problem as tax obstacles are still major obstacles.

Research limitations/implications

There is a need for more detailed data about problems enterprises face in each phase of interaction with tax administrators and managers’ suggested solutions.

Originality/value

The study evaluates the actual effects of a major economic reform, on the microeconomic level during an important period rather than exploring enterprises’ expectations. The results show that there is a need for more reforms targeting small enterprises.

Details

Journal of Economic and Administrative Sciences, vol. 28 no. 1
Type: Research Article
ISSN: 1026-4116

Keywords

Abstract

Details

Taxing the Hard-to-tax: Lessons from Theory and Practice
Type: Book
ISBN: 978-1-84950-828-5

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Article

Odd-Helge Fjeldstad, Merima Ali and Lucas Katera

Inter-organisational cooperation in revenue collection has received limited attention in the tax administration literature. Recent experiences from Tanzania offer a unique…

Abstract

Purpose

Inter-organisational cooperation in revenue collection has received limited attention in the tax administration literature. Recent experiences from Tanzania offer a unique opportunity to examine opportunities and challenges facing such cooperation between central and local government agencies in a developing country context. The administration of property taxes (PT) in Tanzania has been oscillating between decentralised and centralised collection regimes. This paper aims to examine how inter-organisational cooperation affected implementation of the reforms.

Design/methodology/approach

The study draws on data from a variety of sources of information collected during a series of fieldworks over the past decade. Semi-structured interviews were conducted with a wide range of stakeholders, including senior managers and operational staff of the national and municipal tax administrations. The interviews focused on the background and objectives of the property tax reforms, working relations between the central and local government revenue administrations, technical and administrative challenges and innovations, and changes over time with respect to revenue enhancement and implementation of the reforms. Relevant tax legislation and regulations, budget speeches and reports were reviewed.

Findings

Two lessons of broader relevance for policy implementation and PT administration are highlighted. First, institutional trust matters. Top-down reform processes, ambiguity related to the rationale behind the reforms and lack of consultations on their respective roles and expectations have acted as barriers to constructive working relationships between the local and central government revenue agencies. Second, administrative constraints, reflected in poor preparation, outdated property registers and valuation rolls and inadequate incentives for the involved agencies to cooperate hampered the implementation of the reforms.

Originality/value

This paper contributes to the literature on inter-organisational cooperation in revenue collection through a detailed case study of property tax reforms in a developing country context. It also contributes to the literature on policy implementation by identifying political and administrative factors challenging the reform process. In line with this literature, the study shows that policy implementation is not necessarily a coherent process. Instead, it is frequently fragmented and disrupted by changes in policy formulation and access to adequate resources.

Details

Journal of Financial Management of Property and Construction, vol. 24 no. 2
Type: Research Article
ISSN: 1366-4387

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Article

Karen Boll

– The purpose of this paper is to analyse everyday reasoning in public administration. This is done by focusing on front line tax inspectors’ decisions about tax evasion.

Abstract

Purpose

The purpose of this paper is to analyse everyday reasoning in public administration. This is done by focusing on front line tax inspectors’ decisions about tax evasion.

Design/methodology/approach

The paper presents ethnography of bureaucracy and field audits. The material stems from fieldwork conducted in the Central Customs and Tax Administration.

Findings

The paper shows that the tax inspectors reason about tax evasion in a casuistic manner. They pay attention to similar cases and to particular circumstances of the individual cases. In deciding on tax evasion, the inspectors do not just administer the laws; they also enact a policy of fair-mindedness. Doing this they are constrained by time and man-powers, but also enabled by various organizational devices.

Research limitations/implications

The tax inspectors that the author followed were carefully chosen and acted in accordance with procedures. The ethnography should be understood in relation to this set-up.

Originality/value

The originality of the paper is that it shows that ethnography can open the territory of everyday reasoning in public administration. Also, it shows the discretionary room that any front line tax inspector navigates in. This is significant as revenue collection often is described as formal and dominated by a legal steering in which rules are univocal.

Details

Journal of Organizational Ethnography, vol. 4 no. 2
Type: Research Article
ISSN: 2046-6749

Keywords

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