Governance Transparency of Tax Revenue Performance in West Africa

Abstract

This paper summarizes the arguments and counterarguments within the scientific discussion on the issue of governance and taxation revenue performance. The main purpose of the research is to examine the influence of management on tax revenue performance in West African countries. Specifically, the study aimed to investigate the impact of regulatory quality (political stability) and (voice and accountability) on tax revenue performance in West African countries; and to assess the effect of governance efficiency (the rule of law and control of corruption) on the performance of tax generation of West African countries. Secondary data were sourced from Governance indicators which cover 2005 to 2017. Regression analysis was employed to test the research hypotheses: regulatory quality does not significantly influence tax revenue performance in West African countries; and government efficiency does significantly affect tax revenue in West African countries. Sixteen West African countries were purposively chosen because of governance issues such as political instability and government ineffectiveness. The paper presents the results of an empirical analysis, which showed that regulatory quality, political stability and absence of violence, and voice and accountability have insignificant impacts (p-value>5% level of significance) on tax revenue performance. Moreover, government effectiveness, the rule of law and control of corruption have positive and significant impacts (p-value<5% level of significance) on tax revenue performance in West African countries. The study concludes that governance affects tax revenue performance in West African Countries; thus, the study recommends, among others that government should come up with realistic policies that will increase public and civil service quality.

Accountability and revenue generation in Nigeria

“…Similar studies (Audu, 2020;Chukwunwike et al, 2021) in this direction have captured accountability either using the corruption perception index of Transparency International and others (Audu, 2022;Salman et al, 2022;Awotomilusi et al, 2019) using the World Bank Accountability Index. Despite this, there is a need for further study to validate the association that exists between accountability and revenue using different methodologies.…”

“…In one instance, accountability is measured using the corruption perception index of Transparency International (Audu, 2020;Chukwunwike et al, 2021). While on the other hand, accountability has been shown to be measured based on the Worldwide Governance Indicator Accountability Index (Audu, 2022;Salman et al, 2022;Awotomilusi et al, 2019).…”

“…On a larger scale, Salman et al (2022) examined the influence of governance transparency on tax revenue performance in West Africa. Ex post facto research design was used and secondary data was collected over a period spanning from 2005 to 2017.…”

“…This shows that Nigeria has a peculiar revenue generation gap. Salman et al (2022) showed how accountability significantly influenced tax revenue. A critical review of Transparency International 2022 report of the top five rated transparent economies which are Denmark, Finland, New Zealand, Norway and Singapore does not have a tax to GDP of less than 30%.…”

Pengaruh Industri Dan Pendapatan Perkapita Terhadap Penerimaan Pajak Dengan Kualitas Peraturan Sebagai Pemoderasi

“…Hal ini berbeda dengan temuan Nnyanzi et al (2016) dimana penelitiannya pada Negara East African Community menunjukkan bahwa kualitas peraturan berpengaruh positif terhadap penerimaan pajak. Namun sebagaimana dituturkan oleh (Salman et al, 2022), kualitas peraturan yang diusahakan oleh pemerintah tidak meningkatkan maupun menurunkan persepsi dalam pertumbuhan sektor swasta, sehingga tidak mempengaruhi penerimaan pajak. Dari uraian tersebut, menunjukkan bahwa hipotesis kedua (H3) tidak terbukti, karena REG ternyata tidak berpengaruh terhadap TR.…”