Tax revenue mobilisation is attracting increasing attention among researchers and policymakers in developed and developing countries alike.
There is widespread recognition that increasing tax revenues should be at the core of development strategies, with the aim of reducing dependence on foreign aid, increasing domestic resources to finance development plans, and stimulating transparency and accountability in government–citizen relations.
The recent global financial crisis has certainly given momentum to the issue. On the one hand, it made fiscal matters central to the policy debate in developed countries, which resulted in a higher priority in the development debate as well. On the other hand, it made the possibility of scaled-down aid more concrete. For their part, developing countries – and particularly aid-dependent African countries – have been giving higher priority to domestic revenue mobilisation.
This has resulted in widespread reforms on the policy side (most notably with the introduction of value added tax, or VAT) and on the administration side (with the establishment of semi-autonomous revenue authorities, among other initiatives, to modernise tax administration).