Photo: Takras

How to cite this publication:

Åse Johanne Roti Dahl (2018). Reforming tax systems: The foot soldiers of tax. Bergen: Chr. Michelsen Institute (CMI Impact Series IS 2018:01)

Inefficiency and corruption used to be a trademark of the tax systems in many African countries. CMI research has influenced the way governments and donors think about taxation and development, and contributed to a more transparent and efficient tax system.

What was the problem:

Distortive and ineffective tax systems in Sub-Saharan African countries.

What did we do:

Long-term research projects with extensive fieldwork in Tanzania, Uganda, Zambia, Angola and Namibia interviewing stakeholders and actors at local, regional and national levels. Careful mapping of the patchwork of tax systems and their effects on revenues and state-citizens’ relations. Based on the research findings, reforms were recommended and models for implementation were developed. New tax systems were designed and implemented by African governments.

What happened:

Local and national tax systems were reformed in Tanzania, Uganda and Angola. These reforms inspired and influenced tax policies and tax administrations in other African countries. International development agencies put tax on their agenda and have made tax a priority area.


In 1992, CMI started its extensive tax research on the African continent. It started when a team were engaged by the Tanzanian government to map and reform their tax system. Tax is one of the most important tools states have to increase their revenue. For countries that depend on aid, it can be a make or break. The research started with a request: How can African governments raise taxes in an effective way that contribute to political legitimacy and positive engagement around taxation?

Tax is one of the most important tools states have to increase their revenue. 

Odd-Helge Fjeldstad, Research Professor at CMI, has been a dedicated tax researcher and headed CMI’s long-term commitment to tax research. He says:

When I was still a rookie, an experienced colleague told me that our most important tool, would be good and comfortable shoes.

Mapping a random patchwork of taxes

Comfortable shoes made perfect sense both from a practical and a methodological perspective. In 1992, many villages in the countryside in Tanzania lacked proper roads and could only be reached by foot. For the researchers, mapping the tax systems and its effects meant seeking information from villagers as well as top bureaucrats. This took them on long treks to remote villages where they got the stories of a highly dysfunctional tax system in an atmosphere of hot-tempered debates, anger and tax offices burnt to the ground.

Head taxes and taxes on agricultural products frequently led to local riots. The tax system, which could hardly be called a system, caused grievances and strife, lacked any transparency and was seriously damaging the relationship between the state and its citizens. It was in desperate need of reform.

Locally, there was a more or less random patchwork of taxes created simply for the purpose of filling up tax collectors’ pockets, says Fjeldstad. Tax collectors fueled anger and resentment by continuously looking for new ways to add to their private income.

In some villages, newly introduced taxes bordered on absurd. One of the taxes that caused an outrage was a chicken tax, implemented by tax collectors in need of money. Chickens were the one thing they knew they would find in abundance in every village, so forcing people to pay taxes for keeping chickens was a safe source of income. If people could not afford to pay the tax, they simply took the chickens.

In Morogoro region, the researchers exposed big-scale tax fraud. People had to pay taxes to hand in maize for sale and never suspected ill will or misdemeanor because they got a receipt. Closer investigation showed that the receipts never got any further than to the tax collectors, and that 95 % of the taxes that were collected ended up in tax collectors’ pockets.

Providing an antidote to a distortive system

The dysfunctional tax system was not only a challenge to poor villagers. It was also a formidable challenge for the state that lost potential revenue.

In close cooperation, CMI researchers, the local research partner REPOA and the Tanzanian government reformed the tax system. They developed a new model for raising tax revenue on the local level. Nuisance taxes and the head tax were abolished. They created a new macro-economic model that made it possible to project tax revenues for the national budget.

CMI together with local researchers, created a new macro-economic model that made it possible to project tax revenues for the national budget.

Shaping tax policies in Africa

Our long-term project for the Tanzanian government is just one in a long line of studies on tax all over Sub-Saharan Africa. The main question in all these studies has been how to tax a larger number of citizens and enterprises in a fair and consensual way.

When CMI first started working on tax in the early 90’s, studies of tax systems in African countries were few and far between. At that time, everyone was talking about how to spend money. Nobody seemed to care much about where the money should come from, says Odd-Helge Fjeldstad.

Through extensive fieldwork with careful mapping of the tax systems and its effects, close collaboration with local research partners and key stakeholders, and always keeping our eyes on the challenges, we have assisted and advised governments and development agencies in Angola, Namibia, Tanzania, Uganda and Zambia. Our research has provided a better understanding of the vital links between taxation, governance and state-building among donors and African governments, thereby contributing to shape tax policies also on the international level.

The report Good tax governance in Africa, where CMI was part of the research team, has been one of the key building blocks for the African Declaration on Good Public Financial Governance that was endorsed by African Ministers of Finance in 2011.

For the tax researchers, communication with stakeholders on all levels has been a priority. The cooperation with key actors has been essential in turning research into actual policies.

Doing high quality research and providing sound policy recommendations depend on a firm understanding of the situation on the ground and the experiences not only of top level bureaucrats and politicians, but also of the working men and women who feel and live with the consequences of paying taxes, says Fjeldstad.

CMI’s research on tax has left footprints in many African countries.


Odd-Helge Fjeldstad

Research Professor, Coordinator: Tax and Public Finance