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Anglophone Crisis in Cameroon: Can indirect tax play a crucial role?

Author

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  • Tchoffo, Rodrigue
  • Nkemgha, Guivis
  • Paul, Tadzong

Abstract

The objective of this article is to develop a policy of indirect taxation on output factors that reconciles losses in case of a waiver of the direct tax in Cameroon. This initiative would help in solving the “Anglophone crisis” in Cameroon by addressing the half of the total tax collected that amounts at CFAF 2429.15 billion to their victims. A static computable general equilibrium model has enabled us to determine the equivalent rate applicable to the labor factor that would make it possible to compensate for losses if the government shifts away from taxation of household income. This rate is 34.569% for an income tax rate of 20%. It also enables boosting growth with an impact on GDP of 7.8%. Besides, each household group that receipts all the other half of tax collected from an indirect tax rate of 10% earns on well-being whereas in case of an equal sharing only the poor households benefit from it.

Suggested Citation

  • Tchoffo, Rodrigue & Nkemgha, Guivis & Paul, Tadzong, 2019. "Anglophone Crisis in Cameroon: Can indirect tax play a crucial role?," MPRA Paper 96457, University Library of Munich, Germany, revised 10 Oct 2019.
    • Handle: RePEc:pra:mprapa:96457
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    References listed on IDEAS

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    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions

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