Successfully tackling tax issues requires enhanced detailed diagnostic work, dialogue, capacity development, and realistic assessments of the dynamics working against tax collection in countries. Unless program design considers addressing long-standing governance problems that impair tax collection, technical and institutional reform will have limited impact.
Effective tax systems are critical element in driving economic progress. Declining overseas development assistance and dwindling FDI inflows in many developing countries have resulted in greater attention to domestic resource mobilization. As a result, key actors in the development community, including the EU, World Bank Group and IMF are increasingly looking at ways to support country clients to improve tax collection and strengthen domestic enabling environments.
This learning note reviews existing IEG evaluative evidence on the Bank Group’s support to tax policy and administration reform produced by the Independent Evaluation Group over FY2005-15. It identifies the drivers of performance as well as lessons to inform the future work of the Bank Group.