Suchergebnisse

In low-income countries, citizens often pay 'taxes' that differ substantially from what is required by statute. These non-statutory taxes are central to financing both local public goods and maintaining informal governance institutions. This study captures the incidence of informal taxation and taxpayer perspectives onthese payments. It is based on a taxpayer survey, in-depth interviews with government and chiefdom officials, and focus group discussions with community stakeholders across three districts of Sierra Leone. We find, first, that informal taxes are a prevalent reality within areas of weak formal statehoodin Sierra Leone, with households paying an equal number of informal and formal taxes. Second, we find positive taxpayer perceptions of the fairness of informal taxes relative to formal taxes, despite informal taxes beingregressive in theirdistribution. We explain this by the fact that taxpayers are more likely to trust the actor levying these payments, and are more likely to believe that they will be used to deliver benefits to the community.

AbstractWhile there has been increasing policy attention on broadening tax bases in low‐income countries, taxing citizens in rural areas often leads to neither revenue gains nor stronger accountability outcomes. Through case studies of Sierra Leone and Togo, we demonstrate that revenue collection in rural areas is highly inefficient, leading to little, if any, revenue gains after factoring in collection costs. Accordingly, we question the existing rationales for extending taxation to rural citizens in low‐income countries. Instead, we argue for a rethinking of the role of taxation in rural areas, considering the nature of social contracts and limited fiscal reciprocity.

Abstract
Individuals in low-income countries often contribute significantly to financing local public goods through informal taxation. However, there is limited understanding of how informal revenue generation relates to formal tax and governing institutions. We explore the relationship between informal revenue generation, public finance, and the state in the Gedo region in south-central Somalia, relying on original data from surveys with 2,300 households and 117 community leaders. Our evidence shows that informal revenue generation by non-armed actors in Gedo is prevalent, with informal payments deeply embedded within clan-based and Islamic institutions and rooted in a long history of decentralized political authority and self-reliance in the region. We argue that in such a context, rather than explaining how or why things 'work' outside of the state, it may be more relevant and valuable to consider decentralized non-state public authority as the default referent, with a need only to explain the puzzle of pockets of state effectiveness. Governance largely operates outside the state, with citizens playing a pivotal role in directly financing local governance institutions and public goods provision. These findings have important implications for our understanding of statehood and public finance in contexts of weak formal institutions.

AbstractCommunity 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 non‐state actors in governance and service provision, formal and informal institutions, and formal and informal taxation.

Cet article s'intéresse aux rapports différenciés des hommes et des femmes de l'Est et du Nord de la Sierra Leone à la collecte des taxes formelles et informelles. Il fait valoir que la littérature sur la fiscalité et l'égalité entre les sexes dans les pays à faible revenu doit accorder plus d'attention aux modalités réelles de financement des services publics par les citoyens. Il montre que la fiscalité formelle touche une proportion très réduite de la population, et en particulier de la population féminine. Dans les faits, les femmes participent le plus souvent au financement des services publics locaux par le biais de contributions informelles. Cette réalité va de pair avec un renforcement des inégalités entre les sexes, en raison des effets de la fiscalité sur la distribution du pouvoir au sein des ménages d'une part, et de la réduction induite des opportunités de représentation politique d'autre part.

AbstractAround the world, the Covid-19 pandemic drew attention to state social protection and its limitations. Less attention has been paid to what is likely the world's largest system of predominantly non-state welfare provision: zakat, an annual Islamic obligatory payment of a percentage of productive wealth to the poor and other eligible recipients. We explore how states and citizens engage with zakat during crises through a case study of the Covid-19 pandemic in Pakistan, Egypt, and Morocco, drawing on novel and nationally representative survey data of 5484 respondents across the three countries. While we may expect that citizens may be less motivated to pay zakat in times of personal economic hardship, we find that a large majority of the general population and of zakat contributors perceives zakat as particularly important in the Covid context. We show that while zakat may play an important role in non-state social welfare provision supplementing state social protection and redistribution in times of crisis, state attempts to harness it are often ineffective. However, while we find that higher income individuals are more likely to pay zakat, even only among those that are eligible, there are potentially negative equity impacts given the flat rate at which it is levied and the fact that people tend to give through personal networks.

AbstractWe investigate whether social protection programs can increase participation in community‐driven development programs and examine how this affects state‐citizen relations. Using a randomized controlled trial in south‐central Somalia, we study the impacts of one‐time unconditional cash transfers to vulnerable households that were specifically designed to encourage participation in community development. While the cash transfer is relatively small as a share of annual household expenditure, it is more than sufficient to cover households' anticipated community development contributions. The transfers were funded by an NGO but delivered through state institutions. We collect survey data before and after the intervention with almost 600 individuals eligible to receive cash transfers. We find no substantial differences in participation in community development projects for cash transfer recipient households relative to non‐recipient households. However, we do find positive impacts of the cash transfers on citizen perceptions of clan elders and the local government. Our findings suggest that relatively small social protection interventions may face challenges in increasing vulnerable households' participation in community development and decision‐making, while also highlighting potential positive spillover effects for state‐citizen relations and beliefs about the capacity of local institutions where states institutions are involved in program delivery, even if they do not finance the program.