## Taxation and Development: Again

_IMF Working Papers, September 1, 2012_

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## Bibliographic details
- Authors: Michael Keen
- Published: September 1, 2012
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781475510294.001

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### Summary and central lessons
- Issues of taxation and development have long been a central concern of the IMF and have attracted wider and renewed interest in recent years.
- The paper reflects on three broad lessons of experience:
  - Developing countries differ vastly in tax matters, and in ways that are less than fully understood.
  - The history of ‘big ideas’ in guiding tax reform for developing countries is decidedly mixed.
  - The value of the emphasis often placed in this context on ‘informality’ is decidedly limited.
- The paper also asks whether ideas of ‘state building’ emphasized in some recent literature are likely to lead to practical advice much different from that commonly offered now.

### Findings and analysis
- Heterogeneity:
  - Developing countries exhibit vast differences in tax matters; these differences are not fully understood.
- Assessment of reform paradigms:
  - The record of ‘big ideas’ for tax reform in developing countries is described as decidedly mixed.
- Role of informality:
  - Emphasis on ‘informality’ in the taxation and development debate is characterized as decidedly limited in value.
- State-building literature:
  - The paper questions whether state-building ideas in recent literature would alter practical tax policy advice compared with current approaches.

### Policy implications and considerations
- Tailor tax advice and reform strategies to country-specific tax structures and contexts rather than relying solely on broad “big idea” prescriptions.
- Exercise caution in overemphasizing informality as a central explanation or policy target for tax performance in developing countries.
- Evaluate whether state-building frameworks produce materially different practical recommendations for tax policy and administration before adopting them as distinct policy guidance.

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## Content in this bundle

- **Taxation and Development--Again; by Michael Keen; IMF Working Paper 12/220; September 1, 2012**
  - [Taxation and Development--Again; by Michael Keen; IMF Working Paper 12/220; September 1, 2012 (Markdown version)](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2012/_wp12220.pdf.md){rel="alternate" type="text/markdown"}
  - [Taxation and Development--Again; by Michael Keen; IMF Working Paper 12/220; September 1, 2012 (PDF)](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2012/_wp12220.pdf){rel="external" type="application/pdf"}

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_Source: https://www.imf.org/en/publications/wp/issues/2016/12/31/taxation-and-development-again-26242_