Tax Revenue Mobilisation in Sub‐Saharan Africa: Does the Independence of the Tax Administration Matter?

ABSTRACT The objective of this article is to analyse the effect of the independence of tax administrations in 40 sub‐Saharan African countries on tax revenue mobilisation between 2000 and 2022. It assesses how de jure and de facto independence influence the collection of direct and indirect taxes, using a seemingly unrelated model (SURE) and a linear double regression model. The findings reveal that de jure independence has a positive effect on direct tax mobilisation. Specifically, the financial and regulatory autonomy of tax administrations positively impacts the direct tax burden. However, for indirect taxes, only organisational autonomy shows a significant effect on mobilisation. The study also highlights that de facto independence, which reflects the quality of institutional practices, has a positive impact on both direct and indirect tax mobilisation. The analysis concludes that simply granting autonomy to a revenue authority is not a guaranteed process for inefficient tax mobilisation. Instead, the findings suggest that the most effective approach is to establish a tax administration that operates with the efficiency and management structure of a private entity. The study recommends that developing countries governments prioritise creating public administrations that are responsive and well‐governed, particularly for the collection of direct taxes which are crucial for economic growth but remain low in Sub‐Saharan Africa.