How far has the recent global wave of tax reform contributed to state building in poorer countries? This chapter concludes that there are a large number of good things to report, but worrying problems in the poorest and most aid dependent countries. The governments of those countries have little choice but to go along with a reform agenda that is not strongly rooted in their particular circumstances. The choice of policy problems, and of the means of dealing with them, reflect too much the enthusiasms of the more powerful actors in the international system.  More important perhaps, the global reform agenda does not address some of the more urgent problems that the poorest countries face. The contemporary global tax reform agenda is least appropriate to those countries most in need of the state-building to which the taxation process has contributed at in other places and times. A reform agenda focused on issues of state building in the poorer countries would look substantially different.

Reprint of Fjeldstad and Moore (2008), Chapter 10 (pp. 235-260) in Deborah Braütigam, Odd-Helge Fjeldstad & Mick Moore eds. (2008). Taxation and state building in developing countries. Cambridge: Cambridge University Press. The International Library of Critical Writings in Economics Series, published by Edward Elgar, combines the best research from the past three decades on tax reform in developing countries to highlight the state of knowledge of tax reform, analyse useful policy options and present new and critical approaches to this critical issue.

Odd-Helge Fjeldstad

Research Professor, Coordinator: Tax and Public Finance