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Corruption and tax compliance: evidence from small retailers in Bamako, Mali

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  • Luisito Bertinelli
  • Arnaud Bourgain
  • Florian Léon

Abstract

We investigate the impact of corruption on tax compliance using a sample of 700 small business in Bamako, Mali. The main contribution of this paper is to focus on micro-enterprises (including semi-formal and informal ones), while existing works concentrate on large and formal firms. Our results show that (i) even very small firms pay taxes (two-thirds of firms pay taxes in our sample); and, (ii) paying bribes reduces significantly tax compliance. This latter finding is robust (i) to the addition of a set of control variables accounting for other determinants, (ii) to treatment for endogeneity, and (iii) the use of a different proxy for tax compliance.

Suggested Citation

  • Luisito Bertinelli & Arnaud Bourgain & Florian Léon, 2020. "Corruption and tax compliance: evidence from small retailers in Bamako, Mali," Applied Economics Letters, Taylor & Francis Journals, vol. 27(5), pages 366-370, March.
    • Handle: RePEc:taf:apeclt:v:27:y:2020:i:5:p:366-370
    DOI: 10.1080/13504851.2019.1616057
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    Cited by:

    1. Richard Agbanyo & Godwin Musah & James Ntiamoah Doku & Joseph Quarshie & Nyuregbee Yahbewobr Dery, 2024. "Perceived political corruption and tax compliance intentions among private enterprises in emerging economies: The roles of tax morale and tax tolerance in Ghana," Journal of International Development, John Wiley & Sons, Ltd., vol. 36(4), pages 2063-2095, May.
    2. Adamu Jibir & Musa Abdu & Tasiu Muhammad, 2020. "Analysis of Tax Compliance in Sub-Saharan Africa: Evidence from Firm-Level Study," Econometric Research in Finance, SGH Warsaw School of Economics, Collegium of Economic Analysis, vol. 5(2), pages 119-142, December.
    3. Azra Khan & Sadia Safdar & Nazima Elahi, 2021. "An Evaluation Of The Impact Of Corruption On Tax Morale And Taxation In Pakistan," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 10(3), pages 259-272.
    4. Tom Moerenhout & Joonseok Yang, 2022. "Tax Evasion Attitudes of Small Firms in Low‐ and Middle‐income Countries: Evidence from Nigeria," Development Policy Review, Overseas Development Institute, vol. 40(6), November.
    5. Viljar Haavik & Abdoul Wahab Cissé, 2024. "Taxing the informal sector: Coping with Coercion in Bamako, Mali," Development Policy Review, Overseas Development Institute, vol. 42(4), July.
    6. Halil D. Kaya, 2023. "The Global Crisis, Retailers, Taxes And Regulations," Annals - Economy Series, Constantin Brancusi University, Faculty of Economics, vol. 4, pages 92-97, August.

    More about this item

    JEL classification:

    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption

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