Estimating Border Tax Evasion in Mozambique

TY - JOUR

T1 - Estimating Border Tax Evasion in Mozambique

AU - Arndt, Channing

AU - Van Dunem, Joao Ernesto

PY - 2009

Y1 - 2009

N2 - The relationship between border tax rates and evasion is examined for Mozambique using the methodology developed by Fisman and Wei (2004). We find that high tax rates are associated with high levels of under-reporting of import values and that tax rates have a strong and positive effect on tax evasion. Results also strongly confirm the presence of fraudulent classification of merchandise into lower taxed product categories. Finally, analysis of the revenue implications of lower trade taxes finds that the revenue curve is quite flat but remains upward sloping with respect to the tax rate when only evasion is considered.

AB - The relationship between border tax rates and evasion is examined for Mozambique using the methodology developed by Fisman and Wei (2004). We find that high tax rates are associated with high levels of under-reporting of import values and that tax rates have a strong and positive effect on tax evasion. Results also strongly confirm the presence of fraudulent classification of merchandise into lower taxed product categories. Finally, analysis of the revenue implications of lower trade taxes finds that the revenue curve is quite flat but remains upward sloping with respect to the tax rate when only evasion is considered.

KW - Faculty of Social Sciences

KW - Corruption < Government, State Policy, & Ideologies, Tax < Economics, Africa

U2 - 10.1080/00220380902952324

DO - 10.1080/00220380902952324

M3 - Journal article

SN - 0022-0388

VL - 45

SP - 1010

EP - 1025

JO - Journal of Development Studies

JF - Journal of Development Studies

IS - 6

ER -