Does Progressivity Raise Tax Capacity? Experimental Evidence from the D.R. Congo

Gabriel Tourek, Arthur Laroche, Augustin Bergeron, Joana Naritomi, Jonathan L. Weigel and Marina Mavungu Ngoma

No 35536, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Progressive taxation is central to high-income countries' tax systems, but developing countries typically rely on less progressive instruments. We study the introduction of progressive property taxation in a large Congolese city through a citywide field experiment conducted in partnership with the provincial government. Neighborhoods were randomly assigned to a progressive or a proportional schedule. The progressive schedule increased revenue by 56% relative to the proportional one. Gains occurred throughout the property value distribution: at the top, higher statutory rates mechanically raised revenue despite modest compliance losses; at the bottom, lower rates induced compliance gains large enough to offset lower liabilities. Cross-randomized information treatments show that taxpayers responded primarily to their own rates, not to others' rates or to the perceived fairness of the overall schedule. Effective tax rates – taxes paid as a share of property value – declined with property value and were most regressive under the progressive schedule. However, after a progressive schedule was scaled up citywide in subsequent years, targeted enforcement among high-value properties reversed this pattern, aligning statutory and effective rates. Together, the results suggest that progressive property taxation can raise fiscal capacity in low-income settings and, when paired with targeted enforcement, further shift the tax burden onto wealthier property owners.

JEL-codes: H0 O10 (search for similar items in EconPapers)
Date: 2026-07
Note: DEV PE
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