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The purpose of this study is to systematise and analyse existing knowledge on taxation in fragile states. Efforts to support domestic revenue mobilisation in conflict situations require a different approach and other means than in the more stable developing countries. On that basis, the study discusses possible entry points for Norwegian support to domestic revenue mobilisation in ways that may contribute to strengthen state-building and improve government legitimacy.

Complexity, limited experience and security concerns suggest that one should be cautious to adopt bilateral technical assistance programmes of the kind implemented in other developing countries. Instead, the study argues in favour of engagement via multilateral institutions, including multi-donor trust funds and other forms of pooled resources.

Nine entry points are recommended for Norwegian support to taxation in fragile states:

  1. Do no harm
  2. Safeguard donor coordination, but ensure a certain humility
  3. Support customs administration
  4. Capacitate management and taxation of natural resources
  5. Support the United Nations Tax Committee
  6. Improve taxpayer-tax administration relations
  7. Remember the sub-national tax system
  8. Support civil based organisations
  9. Develop research capacity

Viable entry points are likely to differ substantially from country to country depending on context and demand. Fragility has many features and the challenges facing different states differ.

Odd-Helge Fjeldstad

Research Professor, Coordinator: Tax and Public Finance

Taxation in fragile states

Jul 2017 - Feb 2018