This study sheds light on some of the factors underlying tax compliance in local authorities in Tanzania with the help of original survey data. We use the experience of the poll tax (locally named "development levy") as our case. The survey data indicate that tax compliance seems to be positively related to ability to pay, the (perceived) probability of being prosecuted, and the number of tax evaders known personally to the respondent. Severe sanctions, including strict enforcement and harassment of taxpayers, and discontent with what people feel they get in return from the government may increase tax resistance, and, thus contribute to explain the widespread evasion observed.

Odd-Helge Fjeldstad

Research Professor, Coordinator: Tax and Public Finance