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Estimating tax gaps in Zambia: A bottom-up approach based on audit assessments

Author

Listed:
  • Kwabena Adu-Ababio
  • Aliisa Koivisto
  • Eliya Lungu
  • Evaristo Mwale
  • Jonathan Msoni
  • Kangwa Musole

Abstract

Assessing tax gaps—the difference between the potential and actual taxes raised—plays a vital role in achieving positive domestic revenue objectives through improved and reformed taxation. This is particularly pertinent for growth outcomes in developing countries. This study uses a bottom-up approach based on micro-level audit information to estimate the extent of tax misreporting in Zambia.

Suggested Citation

  • Kwabena Adu-Ababio & Aliisa Koivisto & Eliya Lungu & Evaristo Mwale & Jonathan Msoni & Kangwa Musole, 2023. "Estimating tax gaps in Zambia: A bottom-up approach based on audit assessments," WIDER Working Paper Series wp-2023-25, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:wp-2023-25
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    References listed on IDEAS

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    1. Andreas G. F. Hoepner & David McMillan & Andrew Vivian & Chardin Wese Simen, 2021. "Significance, relevance and explainability in the machine learning age: an econometrics and financial data science perspective," The European Journal of Finance, Taylor & Francis Journals, vol. 27(1-2), pages 1-7, January.
    2. -, 2020. "CEPAL Review no. 131," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), August.
    3. Sendhil Mullainathan & Jann Spiess, 2017. "Machine Learning: An Applied Econometric Approach," Journal of Economic Perspectives, American Economic Association, vol. 31(2), pages 87-106, Spring.
    4. Mascagni, Giulia & Mukama, Denis & Santoro, Fabrizio, 2019. "An Analysis of Discrepancies in Taxpayers' VAT Declarations in Rwanda," Working Papers 14421, Institute of Development Studies, International Centre for Tax and Development.
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    More about this item

    Keywords

    Tax gap; Value-added tax; Bottom-up approach; Audits; Tax compliance; Tax administration; Zambia;
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