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Who benefits from taxation of forest products in Nepal's community forests?

Author

Listed:
  • Lund, Jens Friis
  • Baral, Keshab
  • Bhandari, Nirmala Singh
  • Chhetri, Bir Bahadur Khanal
  • Larsen, Helle Overgaard
  • Nielsen, Øystein Juul
  • Puri, Lila
  • Rutt, Rebecca Leigh
  • Treue, Thorsten

Abstract

This paper is concerned with who benefits from taxation of forest products in Nepal's community forests. The objectives of the study are two-fold; to document who benefits from community forestry user groups' (CFUG) financing of investments in public services and infrastructure and pro-poor initiatives and to explore whether biases against certain groups in investments coincide with biases in their participation in decision-making. The paper is based upon data on taxation income and revenue expenditures of 45 community-forest user groups (CFUG) and on data from 1111 CFUG member households on socio-economic status and participation in and perceptions of CFUG management. The results indicate an overall bias against poor and Dalit households in terms of access to CFUG funded public infrastructure. This overall picture conceals important variation; including that poor CFUG members have a higher likelihood of obtaining CFUG financed pro-poor loans than more well-off groups. However, members of the CFUG executive committees have an even higher likelihood of obtaining loans. Results also show that most CFUG members are knowledgeable about CFUG finances, but that they generally express dissatisfaction with the level of transparency about CFUG finances and decision-making processes. Further, poor and Dalit households are generally less knowledgeable on and participate less in CFUG management than other groups, and are less well represented on the CFUG executive committees. Thus, overall, the distribution of benefits from taxation of forest products in community forestry remains unequal, and the disadvantaged groups are poorly placed to claim a larger share of the benefits. Accordingly, the evidence presented in the paper exemplifies how participatory policies are framed by existing inequalities and social hierarchies, but also how such policies may modify these structures through affirmative strategies, such as the policy on pro-poor activities of CFUGs.

Suggested Citation

  • Lund, Jens Friis & Baral, Keshab & Bhandari, Nirmala Singh & Chhetri, Bir Bahadur Khanal & Larsen, Helle Overgaard & Nielsen, Øystein Juul & Puri, Lila & Rutt, Rebecca Leigh & Treue, Thorsten, 2014. "Who benefits from taxation of forest products in Nepal's community forests?," Forest Policy and Economics, Elsevier, vol. 38(C), pages 119-125.
  • Handle: RePEc:eee:forpol:v:38:y:2014:i:c:p:119-125
    DOI: 10.1016/j.forpol.2013.04.010
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    References listed on IDEAS

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    1. Agrawal, Arun & Gupta, Krishna, 2005. "Decentralization and Participation: The Governance of Common Pool Resources in Nepal's Terai," World Development, Elsevier, vol. 33(7), pages 1101-1114, July.
    2. Iversen, Vegard & Chhetry, Birka & Francis, Paul & Gurung, Madhu & Kafle, Ghanendra & Pain, Adam & Seeley, Janet, 2006. "High value forests, hidden economies and elite capture: Evidence from forest user groups in Nepal's Terai," Ecological Economics, Elsevier, vol. 58(1), pages 93-107, June.
    3. Adhikari, Bhim & Di Falco, Salvatore & Lovett, Jon C., 2004. "Household characteristics and forest dependency: evidence from common property forest management in Nepal," Ecological Economics, Elsevier, vol. 48(2), pages 245-257, February.
    4. Chakraborty, Rabindra Nath, 2001. "Stability and outcomes of common property institutions in forestry: evidence from the Terai region of Nepal," Ecological Economics, Elsevier, vol. 36(2), pages 341-353, February.
    5. Pokharel, Ridish K., 2012. "Factors influencing the management regime of Nepal's community forestry," Forest Policy and Economics, Elsevier, vol. 17(C), pages 13-17.
    6. Chhetri, Bir Bahadur Khanal & Lund, Jens Friis & Nielsen, Øystein Juul, 2012. "The public finance potential of community forestry in Nepal," Ecological Economics, Elsevier, vol. 73(C), pages 113-121.
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    Citations

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    Cited by:

    1. Yadav, Bhagwan Dutta & Bigsby, Hugh & MacDonald, Ian, 2015. "How can poor and disadvantaged households get an opportunity to become a leader in community forestry in Nepal?," Forest Policy and Economics, Elsevier, vol. 52(C), pages 27-38.
    2. Rutt, Rebecca Leigh & Chhetri, Bir Bahadur Khanal & Pokharel, Ridish & Rayamajhi, Santosh & Tiwari, Krishna & Treue, Thorsten, 2015. "The scientific framing of forestry decentralization in Nepal," Forest Policy and Economics, Elsevier, vol. 60(C), pages 50-61.
    3. Oli, Bishwa Nath & Treue, Thorsten & Smith-Hall, Carsten, 2016. "The relative importance of community forests, government forests, and private forests for household-level incomes in the Middle Hills of Nepal," Forest Policy and Economics, Elsevier, vol. 70(C), pages 155-163.
    4. Chomba, Susan & Treue, Thorsten & Sinclair, Fergus, 2015. "The political economy of forest entitlements: can community based forest management reduce vulnerability at the forest margin?," Forest Policy and Economics, Elsevier, vol. 58(C), pages 37-46.
    5. Toft, Maja Nastasia Juul & Adeyeye, Yemi & Lund, Jens Friis, 2015. "The use and usefulness of inventory-based management planning to forest management: Evidence from community forestry in Nepal," Forest Policy and Economics, Elsevier, vol. 60(C), pages 35-49.
    6. Moktan, Mani Ram & Norbu, Lungten & Choden, Kunzang, 2016. "Can community forestry contribute to household income and sustainable forestry practices in rural area? A case study from Tshapey and Zariphensum in Bhutan," Forest Policy and Economics, Elsevier, vol. 62(C), pages 149-157.
    7. Lacuna-Richman, Celeste & Devkota, Bishnu P. & Richman, Mark A., 2016. "Users' priorities for good governance in community forestry: Two cases from Nepal's Terai Region," Forest Policy and Economics, Elsevier, vol. 65(C), pages 69-78.

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    Keywords

    Equity; Revenue; Public services; Distribution; Poverty; Asia;

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