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Trade-offs in the Design of Simplified Tax Regimes: Evidence from Sub-Saharan Africa

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dc.contributor.authorHoy, Christopher
dc.contributor.authorScot, Thiago
dc.contributor.authorOguso, Alex
dc.contributor.authorCusters, Anna
dc.contributor.authorZalo, Daniel
dc.contributor.authorDoino, Ruggero
dc.contributor.authorKarver, Jonathan
dc.contributor.authorOrgeira Pillai, Nicolas
dc.date.accessioned2024-09-19T14:24:28Z
dc.date.available2024-09-19T14:24:28Z
dc.date.issued2024-09-19
dc.description.abstractThis paper provides novel evidence of the trade-offs policy makers face when designing simplified tax regimes for small businesses. First, it provides a comprehensive stocktaking of the main features of these regimes across Sub-Saharan Africa: they are adopted by two-thirds of countries, but their design varies greatly. Second, it draws on administrative and survey data for a thorough examination of a specific simplified tax regime. This analysis shows most small businesses lack knowledge about design features, such as the existence of a minimum exemption threshold, but they react strongly to increases in tax rates by lowering their declared turnover. Finally, the paper presents the results of an experiment that encourages taxpayers to pay fixed amounts—a potential alternative design of a simplified tax regime that aims for a better balance of the trade-offs facing policy makers. The findings show that providing simple guidance about how much small businesses with similar characteristics typically pay in taxes can increase revenue, but this reduces equity among taxpayers.en
dc.identifierhttp://documents.worldbank.org/curated/en/099529509162440365/IDU195bd66a01b249141051ad351d04d4880f6e3
dc.identifier.doi10.1596/1813-9450-10909
dc.identifier.urihttps://hdl.handle.net/10986/42165
dc.languageEnglish
dc.language.isoen_US
dc.publisherWashington, DC: World Bank
dc.relation.ispartofseriesPolicy Research Working Paper; 10909
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttps://creativecommons.org/licenses/by/3.0/igo/
dc.subjectTAXATION
dc.subjectPUBLIC FINANCE
dc.subjectSMALL BUSINESSES
dc.subjectRANDOMIZED EXPERIMENT
dc.subjectMICROECONOMICS
dc.subjectDECENT WORK AND ECONOMIC GROWTH
dc.subjectSDG 8
dc.titleTrade-offs in the Design of Simplified Tax Regimesen
dc.title.subtitleEvidence from Sub-Saharan Africaen
dc.typeWorking Paper
dspace.entity.typePublication
okr.associatedcontenthttps://reproducibility.worldbank.org/index.php/catalog/172 Link to data and reproducibility package
okr.crossref.titleTrade-offs in the Design of Simplified Tax Regimes: Evidence from Sub-Saharan Africa
okr.date.disclosure2024-09-19
okr.date.lastmodified2024-09-17T00:00:00Zen
okr.doctypePolicy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/099529509162440365/IDU195bd66a01b249141051ad351d04d4880f6e3
okr.guid099529509162440365
okr.identifier.docmidIDU-95bd66a0-b249-4105-ad35-d04d4880f6e3
okr.identifier.doi10.1596/1813-9450-10909
okr.identifier.doihttps://doi.org/10.1596/1813-9450-10909
okr.identifier.externaldocumentum34391733
okr.identifier.internaldocumentum34391733
okr.identifier.reportWPS10909
okr.import.id5298
okr.importedtrueen
okr.language.supporteden
okr.pdfurlhttp://documents.worldbank.org/curated/en/099529509162440365/pdf/IDU195bd66a01b249141051ad351d04d4880f6e3.pdfen
okr.region.geographicalSub-Saharan Africa
okr.sectorCentral Government (Central Agencies)
okr.themeTax policy,Gender,Human Development and Gender,Economic Policy,Public Finance Management,Fiscal Policy,Domestic Revenue Administration,Public Sector Management
okr.topicFinance and Financial Sector Development::Microfinance
okr.topicMacroeconomics and Economic Growth::Taxation & Subsidies
okr.topicPrivate Sector Development::Business Development Services
okr.unitProsperity-Econ Pol-Mac/Fis-Tax (EMFTX)
okr.unitProsperity-Poverty and Equity-GE (EPVGE)
relation.isAuthorOfPublication3c1ca161-8d86-5478-87dd-0d378c1248e0
relation.isAuthorOfPublication.latestForDiscovery3c1ca161-8d86-5478-87dd-0d378c1248e0
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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