Problems of Administering a Value-Added Tax in Developing Countries

During the 1970s and 1980s, many developing countries enacted value-added taxes (VATs) as a part of their fiscal structures. The productivity of this source of revenue has depended in large part on the facility with which the tax can be administered. Single rate VATs have proved easier to administer than those with multiple rates. Exemptions and zero-rating tend to complicate administration. Because small taxpayers are so numerous in developing countries and administrative resources so limited, the treatment of small taxpayers has required special attention. The difficulty of taxing services has led most developing countries to omit all but a few services from the tax base. Administrative constraints are the main reason why the VAT that prevails in developing countries is usually very different from the broad-based and neutral tax discussed in public finance treatises.Tax administration;Value added tax;Developing countries;Taxation;vat, checking, sales tax, small enterprises, value-added taxes, tax administrations, large taxpayers, vat rate, consumption taxes, publicity, vat revenue, taxpayer resistance, total tax revenue, tax systems, taxpayer information, tax receipts, tax department, sales taxes, vat system, taxpayer identification, income taxes, tax agency, lump sum tax, vat compliance, tax authorities, vat receipts, tax refunds, tax auditors, tax administrators, tax audit, state tax, tax compliance, tax evasion, vat structure, recording, delinquent taxes, indirect taxes

Presumptive Income Taxation

This paper discusses assessment of income on the basis of approximate indicators as opposed to conventional records. Such a method of assessment, known as presumptive income taxation, is widely used in many developing and industrial countries; however, it has been neglected in public finance literature. In most cases the presumptive approach has been followed for administrative reasons, but this paper argues that more attention should be paid to the efficiency implications of presumptive taxes.Income taxes;Tax administration;Taxation;presumptive taxation, tax system, public finance, presumptive taxes, tax evasion, tax liability, tax reform, tax administrations, tax authorities, taxable income, tax systems, progressive taxation, tax payments, tax collections, fiscal reform, tax officials, tax administrators, tax base, tax rates, tax legislation, fiscal documentation, tax department, optimal taxation, tax policy, tax structure, marginal tax rate, tax assessment, corporate income taxes, marginal tax rates, tax departments, tax return, direct taxation, taxpayer compliance, income tax payments, high tax rates, national tax journal, optimal ? tax, taxpaying population, company income tax, taxation of income, tax incomes, tax on wages, theory of taxation, tax revenue, fiscal affairs, sales taxes, federal tax, income tax system, presumptive income tax, amount of tax, interest payments, tax inspectors, sales tax, tax journal, fiscal affairs department, corporate tax rate