How can developing countries learn to tax?

By Antonio Savoia, Global Development Institute, University of Manchester; Roberto Ricciuti, University of Verona and CESifo; and Kunal Sen, UNU-WIDER and Global Development Institute, University of Manchester

Development-Finance-shutterstock_524218915The capability to raise revenues from taxes – often called fiscal capacity – is a crucial aspect for the functioning of every state, particularly in developing countries. Two reasons account for this. First, greater fiscal capacity is fundamentally important for state formation, as it is usually associated with the creation of a civilian bureaucracy that can itself provide an enabling environment for the consolidation of statehood. Second, greater fiscal capacity implies greater access to resources needed to provide public goods. Developing countries are only able to raise a small share of taxes over GDP compared to advanced economies. They need higher revenues to invest in a number of economic and social areas that are crucial for their growth, such as healthcare, education and infrastructure. This is also relevant to pursue the Sustainable Development Goals (SDGs) by 2030, an ambitious enterprise requiring far greater resources. Indeed, SDG 17 explicitly refers to the mobilisation of government revenues (Target 17.1).

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Measuring beyond outcomes: Understanding gender inequality

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By Papa A. Seck (@PABSeck), Chief Statistician, UN Women


This blog is part of a special series marking the launch of the updated
2019 Social Institutions and Gender Index (SIGI)


burkina-faso-sigi-papa-e1544171190150.jpgOver her lifetime, a girl born today in Germany is expected to earn just about half the income of a boy born on the same day. In France and Sweden, she fares slightly better at about 70%. In Turkey, she can expect to earn no more than a quarter.1 Globally, it is estimated that 35% of women have experienced either physical and/or sexual intimate partner violence or sexual violence by a non-partner at some point in their lives. This is the most egregious violation of women’s rights and it is pervasive in all countries around the world, developed and developing alike. Such violence has often tragic consequences. A recent study by UNODC found that a shocking six women are killed every hour by a family member.2 An estimated 650 million women and girls in the world today were married before age 18, and at least 200 million women and girls alive today have undergone female genital mutilation in the 30 countries with representative data on its prevalence. Women around the world do 2.6 times the unpaid care and domestic work that men do, simply because that task is delegated to them by our societies. Continue reading

Paving the Way Towards Progress that Counts

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By Katja Iversen, President/CEO, Women Deliver


This blog is part of a special series marking the launch of the updated
2019 Social Institutions and Gender Index (SIGI)


Sigi-1How can we power development that leaves no one behind?

As we edge towards 2030 – with long ways to go to achieve the Sustainable Development Goals (SDGs) – there may be no more pressing question.

As a champion for gender equality, I have long known that girls and women are powerful agents of change and drivers of development. I see it every day, where even in the most impoverished communities and circumstances women get up, get dressed, and go out to fight for better lives for themselves, their children and their families. And because of that, Women Deliver focuses, relentlessly, on pushing decision makers to place girls and women at the centre of development agendas and approaches.

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Visualising urbanisation: How the Africapolis platform sheds new light on urban dynamics in Africa

By Lia Beyeler, Communications Officer and Nisha Schumann, Consultant, Sahel and West Africa Club Secretariat (SWAC/OECD)

Africa’s urban population is the fastest growing in the world. By 2050, Africa’s cities will be home to nearly one billion additional people. Yet, where and how Africa’s cities of the future emerge and evolve are insufficiently understood.

Traditionally, the focus has been put on larger cities as opposed to smaller urban agglomerations. Yet, smaller agglomerations with populations between 10,000 and 100,000 inhabitants represent one-third of Africa’s overall urban population, accounting for more than 180 million people in 2015. Their significance is highlighted by the fact that many of the continent’s future cities are emerging through the fusion of smaller cities or through population densification in rural areas – trends that are not captured in official statistics and government data, which tend to focus on cities as political units with defined boundaries.

The OECD Sahel and West Africa Club’s Africapolis platform, which launched during the 8th Africities Conference in Marrakesh, seeks to bridge the gap in data on African urbanisation dynamics. It provides a powerful tool for governments, policy makers, researchers and urban planners to better understand urbanisation’s drivers, dynamics and impacts. This understanding, in turn, will help design more relevant policies that address the growing challenges of urbanisation at the local, national and regional levels. Continue reading

Data: The first step to improving finance in African cities

By Astrid R.N. Haas, Manager of Cities that Work, International Growth Centre


This blog is part of an ongoing series exploring the intersection between intermediary cities in developing countries and sustainable development


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Hargeisa, Somalia. Photo: Shutterstock.com

Many African cities are urbanising rapidly. Yet, they are unable to adequately service their growing populations with the necessary infrastructure and amenities due to a lack of finance. Furthermore, retrofitting infrastructure on a city that has already grown is significantly more expensive. Improving local government finance is therefore very high on these cities’ agendas.

Cities can improve their finances in various ways. Perhaps one of the most underutilised yet high potential methods is property tax. Why? Rapid population growth is generally accompanied by a construction boom, increasing the number of properties. Furthermore, if demand for properties rises faster than supply, this will also increase property values. And such values will further benefit once public investments in infrastructure as well as improvements in service delivery are made. All these factors have a positive impact on property tax collection, and thus have the potential to unleash a virtuous cycle for local government revenue.
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What gets measured gets managed: Tapping into local procurement in the mining industry to advance development

By Luke Balleny, Manager, Role of Mining and Metals in Society, International Council on Mining and Metals

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Zambia – crusher for manufactured sand. Photo: Shutterstock

How do mining companies spend their money? If you didn’t know and listened only to the media, you might think such companies spend the most on taxes and royalties. However, you’d be wrong.

When minerals or metals are monetised, the revenue is shared between four main stakeholders in the following ways:

  1. 50–65% of mining revenue goes to operating and capital expenditure, such as the suppliers who are paid for their inputs.
  2. 15–20% goes to government, which receives its share through royalties and taxes.
  3. 15–20% goes to investors who receive profits, typically a residual after the other payments have been made.
  4. 10–20% goes to employees who are paid their wages.

A World Gold Council (WGC) study shows that out of the total annual spending in 2012 of USD 55 billion by the 15 WGC members studied, some USD 35 billion were payments to other businesses, mostly subcontracting and procurement. Less than USD 10 billion were royalty and tax payments to governments.

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Building a GPS for the SDGs: The OECD’s data response to the SDGs

By Martine Durand, Chief Statistician, Director, Statistics Directorate, OECD

World leaders have endorsed 17 Sustainable Development Goals (SDGs). These comprise some 169 targets in fields ranging from poverty and hunger to equality and climate action to peace and justice. To know where we are starting from, whether we’re making progress, and what we need to improve, we will need good data for governments to make evidence-based decisions and for citizens to hold them to account. In other words, what we need is a global positioning system, or a GPS, for the SDGs. We need a data-driven GPS to help map out the best route to arrive at the successful implementation of the SDGs.

Data have been recognised as central to achieving the 2030 Sustainable Development Agenda. The UN Statistical Commission recently endorsed an official set of SDG indicators as the basis for follow-up and review at the global level in the years ahead.

Implementing and monitoring progress towards the SDGs will be very challenging. The new targets are universal – applying to all countries – and they focus on more than development problems. Many of the targets are complex, interlinked and multifaceted, requiring new concepts and measures. The SDGs’ emphasis on leaving no one behind also will require disaggregated data across multiple dimensions, such as gender, age and socio-economic status.

Yet, good reasons exist to be confident. More data are available today than ever, and technological breakthroughs and improved methods now provide more detailed and granular information. New partnerships also are being set up to harness this data revolution.

This progress must continue if we are to meet the data challenges posed by the SDGs. Even in this era of “big data,” no country, including OECD members, has all the data it needs to monitor the SDGs. New sources must be tapped to fill the gaps, and an unprecedented and sustained international effort will be needed to develop the new information required.

The OECD will take part in this effort fully. We are already renowned for our statistics and have been at the forefront of global innovations in statistical methods, systems and dissemination for over half a century. We are a recognised authority on a vast array of economic, social, environmental and development-related statistics. Consider the fact that we have been leading the search for new statistical measures of progress that go beyond GDP by building indicators for well-being and measuring them consistently across OECD countries. On the education front, the OECD’s Programme for International Student Assessment (PISA), already the world’s most widely used gauge of educational outcomes, is being adapted for use in more countries. And we have pioneered other useful tools and concepts to measure progress in areas as diverse as science and technology, income distribution, health, labour, international investment and regional analysis.

But the SDGs require measuring how actions taken in one country affect other countries’ performance. Through our world input-output tables, we track the trans-boundary impacts of production and consumption in OECD countries on CO2 emissions and critical natural resources for example. Our data on Official Development Assistance provide information on country efforts to meet aid targets, and we are developing new metrics, such as Total Official Support for Sustainable Development (TOSSD), to give a more comprehensive view of resource flows. Similarly, our Revenue Statistics provide unique information on the capacity of developing countries’ tax systems to raise domestic resources.

The OECD has been a key contributor to setting global goals for decades. Our 1996 development co-operation strategy, Shaping the 21st Century, was a step towards formulating the Millennium Development Goals, and we have played a vital role in monitoring them over the past 15 years. Now, building a statistical system capable of monitoring the SDGs will demand even greater investment in capacity and skills across the entire spectrum, from conceiving and collecting data to interpreting and communicating them clearly to making them open and accessible to all.

We will do all we can to build the GPS that will help member and partner countries and the whole international community rise to the even greater measurement challenges presented by the SDGs. Building better data for better policies to improve people’s lives today and tomorrow is one goal we are determined to achieve.


 

This article should not be reported as representing the official views of the OECD, the OECD Development Centre or of their member countries. The opinions expressed and arguments employed are those of the author.