Browsing by Subject "economic citizenship"

Taxation has been trending in the financing for development agenda once again since the Monterrey Consensus in 2002. It has been widely stated amongst developing countries, donors and international institutions, that there is a growing importance for enhancing developing countries’ capacity to collect taxes in order to secure financing of SDG’s and reduce dependence on development assistance. Furthermore, it is believed that taxation plays a central role in building democratic and accountable states. Many donor countries, including Finland, have committed to double their support by the year 2020 to improve tax systems in developing countries. Namibia is one of the signatories of the Addis Tax Initiative (ATI), and has committed to step up its revenue collection in accordance with the principles aligned in the ATI. Although it is a popular idea that direct taxing of the citizens can lead to more responsive and accountable governments in developing countries, little research has been conducted that shed light on the complexity of this relationship in practice. The aim of this thesis is to provide insight on how legitimate do Namibian citizens consider the fact that they are being taxed, and which factors influence emergence or lack of this legitimacy. In order to gain understanding on this topic, qualitative thematic interviews have been conducted with Namibians and various tax experts. Three theoretical concepts – fiscal contract proposition, legitimacy and economic citizenship – are applied to the analysis of the interview material to illuminate different aspects that affect the perceived legitimacy of taxation. Although Namibia has a particularly high ratio of tax revenue to GDP in comparison to other sub-Saharan countries and collects a remarkable share of its revenues from direct taxes, it seems that the fiscal contract is unfounded in Namibia. None of the respondents thought that they are directly benefitting from paying taxes and saw very few benefits in paying taxes in general. Particularly the government’s irresponsible spending and corruption were major factors undermining the legitimacy of taxation in Namibia. Taxpayer education and possibilities to influence on the government’s decision-making were considered as very limited. Political culture matters; due to the dominant party system and weak civil society, there seems to prevail an attitude within the Namibian government that they do not need to be accountable toward the taxpaying citizens, as there is no alternative to vote for. The limitations of the fiscal contract proposition in the Namibian context are also discussed considering the demographic, geographic and economic structure, as well as the structure of political decision-making in Namibia. This thesis intends to draw attention to the context-specificity of taxation and its role in shaping state-society relations.