Trade Policy Reform and the Missing Revenue

TY - JOUR

T1 - Trade Policy Reform and the Missing Revenue

AU - Arndt, Thomas Channing

AU - Tarp, Finn

N1 - JEL Classification: D58, H26, O55

PY - 2008

Y1 - 2008

N2 - In many African countries, large discrepancies exist between revenues implied by published tariff rates multiplied by estimated import volumes and actual receipts. We develop a stylised trade model where average and marginal tariff rates diverge and incorporate insights from this model into a computable general equilibrium model of an African economy (Mozambique) to study the implications of trade policy reform. Model simulations indicate that lowering tariff rates and reducing duty-free importation in a manner that maintains official revenue benefit nearly everyone. The main exception is those who benefited from duty-free imports in the base

AB - In many African countries, large discrepancies exist between revenues implied by published tariff rates multiplied by estimated import volumes and actual receipts. We develop a stylised trade model where average and marginal tariff rates diverge and incorporate insights from this model into a computable general equilibrium model of an African economy (Mozambique) to study the implications of trade policy reform. Model simulations indicate that lowering tariff rates and reducing duty-free importation in a manner that maintains official revenue benefit nearly everyone. The main exception is those who benefited from duty-free imports in the base

U2 - 10.1093/jae/ejm007

DO - 10.1093/jae/ejm007

M3 - Journal article

SN - 0963-8024

VL - 17

SP - 131

EP - 160

JO - Journal of African Economies

JF - Journal of African Economies

IS - 1

ER -