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In an interview with Varja Lipovsek, Learning, Monitoring and Evaluation Manager at EASST partner institution Twaweza, and EASST Fellow Fredrick Manang discuss how policymakers and researchers can work together to provide evidence on institutional change and development.
Following the Economic Development and Institutions workshop held in Washington DC from April 13-14, 2015, the Center for Effective Global Action hosted a travel grant competition in partnership with Oxford Policy Management to help support formative work on projects further developed during the event. EASST Fellow Alumni, Fredrick Manang was awarded ~$5,000 in research funding for the evaluation, "Tax Compliance: Enforcing the use of electronic fiscal devices (EFDs)".
Manang will partner with the Tanzanian Revenue Authority (TRA) – Arusha Region, Tanzania to design an evaluation of inspection approaches to improve tax compliance in Tanzania, Rwanda, and Ethiopia. Given insufficient domestic revenue generation to support substantial public service delivery needs in developing countries, tax compliance is a key issue with connections to potential economic growth. However, it lacks clear evidence to inform effective policymaking. Manang will identify compliance inspection methods that could improve the legally mandated use of electronic fiscal devices (EFDs). Sellers must use EFDs to track business transactions; EFDs accurately report to the revenue authority the sales tax or Value-Added-Taxes (VAT) due when sellers comply by issuing the mandated receipts. The TRA has already considered carrying out inspections of business entities given the frequency of evasion at the point of sale. The evaluation would measure the effect of random inspections and associated penalty warnings, primarily on the amount of revenue collected as well as the rates of seller-motivated compliance.
To learn more about the EDI program, go here.