IMF Working Papers

Presumptive Taxation in Sub-Saharan Africa: Experiences and Prospects

By Helaway Tadesse, Günther Taube

January 1, 1996

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Helaway Tadesse, and Günther Taube. "Presumptive Taxation in Sub-Saharan Africa: Experiences and Prospects", IMF Working Papers 1996, 005 (1996), accessed November 23, 2024, https://doi.org/10.5089/9781451842135.001

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

Considering the need to broaden the tax base and to increase tax revenue in an efficient, equitable, and cost-effective manner, this paper analyzes presumptive taxation methods and their application in sub-Saharan Africa. Presumptive taxation involves simple techniques to capture income that frequently escapes conventional taxation. Presumptive taxation methods could be used more intensively in sub-Saharan Africa, and presumptive taxes on imports, withholding schemes, and graduated business license fees are most effective in raising additional tax revenue in a way commensurate with efficiency, equity, and administrative expediency. Also, intensified presumptive taxation will need stronger institutional capacity in tax administration.

Subject: Income and capital gains taxes, Income tax systems, National accounts, Personal income, Presumptive tax, Revenue administration, Tax administration core functions, Taxes

Keywords: Africa, Asia and Pacific, Down payment, Imputed income, Income and capital gains taxes, Income tax, Income tax systems, License tax, Medium-scale enterprise, Overburdened tax authorities, Personal income, Presumptive tax, Presumptive taxation, Sub-Saharan Africa, Tax administration capacity, Tax administration core functions, Tax authorities, Tax authority, Tax levy, Tax liability, Taxable income, Trade tax, Withholding tax, WP

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