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Corruption, Taxes and Compliance
Author:
Ms. Anja Baum null

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,
Mr. Sanjeev Gupta
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Elijah Kimani
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Mr. Sampawende J Tapsoba
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Series:
IMF Working Papers
Volume/Issue:
Volume 2017: Issue 255
Language:
English
Publication Date:
17 Nov 2017
DOI:
https://doi.org/10.5089/9781484326039.001
ISBN:
9781484326039
ISSN:
1018-5941
Pages:
31
Keywords:
WP; tax; revenue; GDP; tax revenue
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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This paper revisits the effects of corruption on the state’s capacity to raise revenue, building on the existing empirical literature using new and more disaggregated data. We use a comprehensive dataset for 147 countries spanning 1995-2014, compiled by the IMF. It finds that—consistent with the existing literature—corruption is negatively associated with overall tax revenue, and most of its components. This relationship is predominantly influenced by the way corruption interacts with tax compliance. The establishment of large taxpayer offices improves tax compliance by dampening the perception of corruption, thereby boosting revenue.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund