Impact of Changes in Tariffs on Developing Countries' Government Revenue
AbstractThis paper addresses tariff revenue concerns that some countries have been expressing in the context of the current multilateral trade negotiations under the Doha Development Agenda. This paper: discusses methodological issues associated with estimating revenue impacts; provides impact estimates for a sample of developing countries; links the differences in impacts to cross-country differences in existing tariff regimes as well as properties of formulas for tariff cuts; and, discusses efficient tax replacement policies and past experiences. Additionally, the paper presents results of a simulation of the welfare effects of reducing tariffs and simultaneously replacing lost tariff revenues with revenues from consumption tax. It concludes with some policy implications.
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Bibliographic InfoPaper provided by OECD Publishing in its series OECD Trade Policy Papers with number 18.
Date of creation: 18 Apr 2005
Date of revision:
CGE simulation; tariff reductions formulas; tariffs; government revenue; multilateral trade negotiations;
Find related papers by JEL classification:
- C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
- E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
- E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
- F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
- F14 - International Economics - - Trade - - - Empirical Studies of Trade
- H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-10-15 (All new papers)
- NEP-CMP-2005-10-15 (Computational Economics)
- NEP-INT-2005-10-15 (International Trade)
- NEP-MAC-2005-10-15 (Macroeconomics)
- NEP-PBE-2005-10-15 (Public Economics)
- NEP-SEA-2005-10-15 (South East Asia)
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- Sam LAIRD, 2007. "Aid for Trade: Cool Aid or Kool-Aid?," G-24 Discussion Papers 48, United Nations Conference on Trade and Development.
- James Scott, 2012. "Squeezing the state: tariff revenue, state capacity and the WTO’s Doha Round," Brooks World Poverty Institute Working Paper Series 16912, BWPI, The University of Manchester.
- Yongzheng Yang & Sanjeev Gupta, 2005. "Regional Trade Arrangements in Africa," IMF Working Papers 05/36, International Monetary Fund.
- Yongzheng Yang, 2005. "Africa in the Doha Round," IMF Policy Discussion Papers 05/8, International Monetary Fund.
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