Review of new World Bank framework “Innovations in Tax Compliance” by Richard Bird published by ICTD (11/2019).
“Innovations in Tax Compliance, a recent World Bank working paper, undertakes two tasks. First, it reviews the rapidly growing theoretical and especially empirical literature on how countries can improve tax compliance and, not so incidentally, raise more tax revenues than most low-income countries now do. Second, it sets out an approach to tax reform that it suggests should yield more sustainable results than past efforts.
The literature survey is fairly comprehensive and provides a useful reference for policymakers and analysts. However, it contains little that should be news to anyone already engaged with tax issues in developing countries. The key roles played by political support in launching and implementing reform, by institutional capacity for enforcement and facilitation in expanding quasi-voluntary compliance, and by fiscal contracting (accountability and the link between taxes and services) and perceptions of how fairly and equitably the tax system is applied in building the trust (social capital) needed to make the system have long been known. The more novel part of the paper is its attempt to combine these elements into a potentially operational framework to guide tax reform…”
Response to Richard Bird’s Critique of “Innovations in Tax Compliance” by Wilson Prichard published by ICTD (11/2019)
“At the request of the ICTD, Professor Richard Bird generously agreed to review the new World Bank publication Innovations in Tax Compliance, which proposes a new framework to help guide the design of tax reform efforts. Richard was the founding Chair of the Advisory Group of the ICTD, and is a long term advisor to the World Bank, and in those roles has always been the best kind of friend: endlessly supportive, but also consistently committed to challenging ongoing work, in order to make it better. His review of Innovations in Tax Compliance is no exception: both tough and deeply insightful, and an important contribution both to making it better and clarifying what it aims to achieve.
In my reading, Professor Bird poses three big picture questions – or challenges – about the framework, which serve to clarify what that framework seeks to achieve, and what it adds…”
