To trust or not to trust? Taxation from the perspective of businesspeople in Tanzania
How to cite this publication:
Viola Asri, Odd-Helge Fjeldstad, Lucas Katera, Samwel Nassary (2025). To trust or not to trust? Taxation from the perspective of businesspeople in Tanzania. Bergen: Chr. Michelsen Institute (CMI Working Paper WP 2025:04)
Given the limited capacity for effective tax enforcement and monitoring in developing countries, taxpayers’ trust in the tax system is essential for fostering voluntary tax compliance. Since businesses account for a substantial portion of tax revenues, this paper examines the factors that predict trust in the tax authority, drawing on a large-scale survey of businesspeople’s experiences with taxation in Tanzania (n=1409). Due to the distinct and often frequent nature of their interactions with tax officials, businesspeople tend to exhibit lower levels of trust in the authority compared to ordinary citizens - making it one of the least trusted government institutions. The analysis identifies key predictors of trust, including satisfaction with the information and services provided by the tax authority, perceptions of tax fairness, and trust in other businesspeople.
