Taxes, Citizens and the Quality of Governance in Africa

Sub-Saharan Africa reached ‘peak aid’ around 1994. At that point, the average government received aid that amounted to about 75% of the tax revenues that it raised. Thereafter, tax revenue increased and aid revenues decreased. Currently, tax revenues are on average three times as large as aid revenues. Within Africa, there are high expectations about this shift toward more financially self-sufficient governments: not only more national autonomy/sovereignty, but also a hope for better governance, based on arguments about the behavioural incentives stemming from the dependence of governments on tax revenues. I will critique these arguments, in a sympathetic way, by looking at the realities of revenue raising in Africa. In particular, I will examine the limitations of the underlying notion that taxes are paid by ‘citizens’, and that the tax relationship can usefully be characterised as an interaction of 'states’ and ‘citizens’. Taxpayers and tax collectors are both diverse categories. Governments are less likely to behave as ‘revenue maximisers’ than some of the standard political science literature suggests.