Economics at your fingertips  

Tax Administration and Firm Performance: New Data and Evidence for Emerging Market and Developing Economies

Era Dabla-Norris, Duncan Cleary, Munawer Khwaja and Florian Misch

No 2017/095, IMF Working Papers from International Monetary Fund

Abstract: Tax compliance costs tend to be disproportionately higher for small and young businesses. This paper examines how the quality of tax administration affects firm performance for a large sample of firms in emerging market and developing economies. We construct a novel, internationally comparable, and multidimensional index of tax administration quality (the TAQI) using information from the Tax Administration Diagnostic Assessment Tool. We show that better tax administration attenuates the productivity gap of small and young firms relative to larger and older firms, a result that is robust to controlling for other aspects of tax policy and of economic governance, alternative definitions of small and young firms, and measures of the quality of tax administration. From a policy perspective, we provide evidence that countries can reap growth and productivity dividends from improvements in tax administration that lower compliance costs faced by firms.

Keywords: WP; tax administration; compliance cost; firm performance; total factor productivity; omitted firm category; small business; firm productivity; cash flow; enterprise manager; micro enterprise; compliance burden; Tax administration core functions; Compliance costs; Tax return filing compliance; Labor productivity; Tax Administration Diagnostic and Assessment Tool (TADAT); Central and Eastern Europe; Central Asia; Global (search for similar items in EconPapers)
Pages: 40
Date: 2017-04-14
References: Add references at CitEc
Citations: View citations in EconPapers (4) Track citations by RSS feed

Downloads: (external link) (application/pdf)
Our link check indicates that this URL is bad, the error code is: 403 Forbidden

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Ordering information: This working paper can be ordered from

Access Statistics for this paper

More papers in IMF Working Papers from International Monetary Fund International Monetary Fund, Washington, DC USA. Contact information at EDIRC.
Bibliographic data for series maintained by Akshay Modi ().

Page updated 2021-06-17
Handle: RePEc:imf:imfwpa:2017/095