The legacy of pre-colonial centralization on tax compliance in Uganda

The study examines the role of pre-colonial institutions on current development  outcomes in Uganda. By comparing pre-colonial centralized ethnic homelands areas and stateless ethnic homelands in Uganda, we present empirical material that pre-colonial centralized kingdoms may have fostered a higher tax compliance norm. Knowledge of the role of deeply rooted pre-colonial institutions is relevant for policymakers as an entry point in terms of shaping citizens’ willingness to contribute to tax revenue. Even though people in historically centralized parts of Uganda have mistrust towards the central government and public institutions, they may be willing to follow rules and pay taxes when they live in a setting with higher interpersonal trust. Social and economic policies to increase trust in public institutions can therefore help to improve tax compliance in Uganda. The success of policies to improve trust in public institutions will depend on the leaders’ effort to acknowledge the past.