Corruption and tax compliance: evidence from small retailers in Bamako, Mali

Luisito Bertinelli, Arnaud Bourgain and Florian Leon

Applied Economics Letters, 2020, vol. 27, issue 5, 366-370

Abstract: We investigate the impact of corruption on tax compliance using a sample of 700 small business in Bamako, Mali. The main contribution of this paper is to focus on micro-enterprises (including semi-formal and informal ones), while existing works concentrate on large and formal firms. Our results show that (i) even very small firms pay taxes (two-thirds of firms pay taxes in our sample); and, (ii) paying bribes reduces significantly tax compliance. This latter finding is robust (i) to the addition of a set of control variables accounting for other determinants, (ii) to treatment for endogeneity, and (iii) the use of a different proxy for tax compliance.

Date: 2020
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Working Paper: Corruption and tax compliance: Evidence from small retailers in Bamako, Mali (2018)
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DOI: 10.1080/13504851.2019.1616057

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