Tax and Public Finance
We study how governments collect and manage revenues to create better services for citizens in developing countries. In particular, we research the role of tax to enhance welfare and build political legitimacy.
The importance of tax
There is a growing interest among governments, development agencies and scholars on taxation in developing countries. This reflects a concern for domestic revenue mobilisation to finance public spending, as well as recognition of the centrality of taxation to growth and redistribution.
Improved taxation is seen a key for developing countries to escape from aid or singular natural resource dependency. There are also strong synergies between tax reforms and governance. If tax reform is undertaken in a way that promotes greater responsiveness and accountability, alongside improvements in the state’s institutional capacity, then tax reform can become a catalyst for improvements in government performance. Seen in this light, taxation is not just an administrative task for governments and citizens. It is also about politics and power, and the way that authority is exercised in a country through its formal and informal institutions.
A key research issue for CMI is how governments in poor countries can raise financial resources in ways that enhance their effectiveness and political legitimacy. An overarching objective of our research is to contribute with empirical and theoretical insights to inform the reform agenda and policy debates on tax reforms in developing countries. CMI has strong expertise in the areas of
(i) taxation and governance, including fiscal corruption;
(ii) tax compliance (building taxpaying cultures);
(iii) tax reform in natural resource rich countries;
(iv) sub-national taxation, including property tax reform; and
(v) intra-governmental fiscal relations, including coordination and exchange of information between government agencies.
CMI also has substantial experience in the design and implementation of formative process research that closely follows the implementation and impacts of reforms over time.
CMI's research contributes with empirical and theoretical insights to inform the reform agenda and policy debates on tax reforms in developing countries. Through high quality, practically-oriented political economy research and communication activities aiming to improve taxation in poorer countries, the users of our research include governments, development agencies, private enterprises, civil society and academia.
Research and advisory work
Taxation and public finance management is one of CMI's core areas of research and advisory work. Our work on taxation and development started already in 1992 with a revenue-modelling project for the Government of Tanzania. The theoretical perspectives and methodologies applied are based primarily in the disciplines of economics and political science, but also involves social anthropology, law and history. As a multidisciplinary research institute, CMI researchers apply both quantitative and qualitative methodologies, including analysis of tax administrative data, citizen and business surveys, experiments and interviews with stakeholders. The studies are generally designed and implemented in collaboration with partners in developing countries with the aim to build research capacity and inform policy. In recent years, some projects have been conducted in partnership with the International Centre for Tax and Development (ICTD). CMI researchers have been advisors for African governments on public financial management, and have worked as consultants on tax reforms for bilateral and multilateral development organisations, including ATAF, DFID, Norad, the Norwegian Ministry of Foreign Affairs, OECD, IFC and the World Bank.
During the last two decades, CMI's research and advisory work has addressed a wide range of issues on taxation and reform, including:
- taxation and state-building in developing countries;
- good tax governance in Africa (with ATAF);
- taxpayers' compliance in Ethiopia, Kenya, South Africa, Tanzania, and Uganda;
- fiscal corruption in Tanzania and Uganda;
- local government taxation and fiscal decentralisation in Namibia, South Africa, Sudan, Tanzania and Uganda;
- tax reforms in Ethiopia, Namibia, Sudan, Tanzania and Zambia;
- mining taxation in Zambia;
- the design and implementation of the non-oil tax reform in Angola; and
- donor support to strengthen the tax systems in Mozambique, Tanzania and Zambia.
Chr. Michelsen Institute is committed to quality and relevance, and puts strong emphasis on reaching its core target groups through tailor-made outputs. There is also a strong emphasis on publications in international refereed journals to ensure and maintain a high academic standard. CMI publishes CMI Reports and CMI Working Papers, CMI Briefs, CMI News and the CMI Annual Report, as well as U4-publications in the form of Briefs and Issue Papers. CMI's research on taxation is widely refered to by reseachers, tax practioners, revenue authorities in developing countries, donors, civil society organisations and the media.
CMI enjoys an extensive network of international contacts, and has formal co-operation agreements with various research institutions in Africa (Angola, Ethiopia, Malawi, Mozambique, Sudan, Tanzania, Zambia), Asia (Afghanistan, Bangladesh, India, Indonesia, Nepal), Latin-America (Argentina, Chile, Colombia, Uruguay), and the Middle East (Iran, Lebanon, Palestine). Institutional co-operation facilitates joint research, institutional development and competence building. In Norway, CMI has close formal institutional collaborations with the University of Bergen and the Norwegian School of Economics and Business Administration (NHH), including teaching, joint research projects and support to graduate students and PhD candidates.