Political Connections and Tariff Evasion Evidence from Tunisia

Are politically connected firms more likely to evade taxes? This paper presents evidence suggesting firms owned by President Ben Ali and his family were more prone to evade import tariffs. During Ben Ali's reign, evasion gaps, defined as the difference between the value of exports to Tunisia re...

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Bibliographic Details
Main Authors:	Rijkers, Bob, Baghdadi, Leila, Raballand, Gael
Format:	Journal Article
Published:	Published by Oxford University Press on behalf of the World Bank 2018
Subjects:	TARIFFS TRADE POLICY TAX EVASION CORRUPTION BUREAUCRACY POLITICAL NETWORKS
Online Access:	http://hdl.handle.net/10986/30960

id	okr-10986-30960
recordtype	oai_dc
spelling	okr-10986-309602021-05-25T10:54:35Z Political Connections and Tariff Evasion Evidence from Tunisia Rijkers, Bob Baghdadi, Leila Raballand, Gael TARIFFS TRADE POLICY TAX EVASION CORRUPTION BUREAUCRACY POLITICAL NETWORKS Are politically connected firms more likely to evade taxes? This paper presents evidence suggesting firms owned by President Ben Ali and his family were more prone to evade import tariffs. During Ben Ali's reign, evasion gaps, defined as the difference between the value of exports to Tunisia reported by partner countries and the value of imports reported at Tunisian customs, were correlated with the import share of connected firms. This association was especially strong for goods subject to high tariffs, and driven by underreporting of unit prices, which diminished after the revolution. Consistent with these product-level patterns, unit prices reported by connected firms were lower than those reported by other firms and declined faster with tariffs than those of other firms. Moreover, privatization to the Ben Ali family was associated with a reduction in reported unit prices, whereas privatization per se was not. 2018-12-06T19:49:04Z 2018-12-06T19:49:04Z 2017-06-01 Journal Article World Bank Economic Review 1564-698X http://hdl.handle.net/10986/30960 CC BY-NC-ND 3.0 IGO http://creativecommons.org/licenses/by-nc-nd/3.0/igo World Bank Published by Oxford University Press on behalf of the World Bank Publications & Research :: Journal Article Publications & Research Middle East and North Africa Tunisia
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
topic	TARIFFS TRADE POLICY TAX EVASION CORRUPTION BUREAUCRACY POLITICAL NETWORKS
spellingShingle	TARIFFS TRADE POLICY TAX EVASION CORRUPTION BUREAUCRACY POLITICAL NETWORKS Rijkers, Bob Baghdadi, Leila Raballand, Gael Political Connections and Tariff Evasion Evidence from Tunisia
geographic_facet	Middle East and North Africa Tunisia
description	Are politically connected firms more likely to evade taxes? This paper presents evidence suggesting firms owned by President Ben Ali and his family were more prone to evade import tariffs. During Ben Ali's reign, evasion gaps, defined as the difference between the value of exports to Tunisia reported by partner countries and the value of imports reported at Tunisian customs, were correlated with the import share of connected firms. This association was especially strong for goods subject to high tariffs, and driven by underreporting of unit prices, which diminished after the revolution. Consistent with these product-level patterns, unit prices reported by connected firms were lower than those reported by other firms and declined faster with tariffs than those of other firms. Moreover, privatization to the Ben Ali family was associated with a reduction in reported unit prices, whereas privatization per se was not.
format	Journal Article
author	Rijkers, Bob Baghdadi, Leila Raballand, Gael
author_facet	Rijkers, Bob Baghdadi, Leila Raballand, Gael
author_sort	Rijkers, Bob
title	Political Connections and Tariff Evasion Evidence from Tunisia
title_short	Political Connections and Tariff Evasion Evidence from Tunisia
title_full	Political Connections and Tariff Evasion Evidence from Tunisia
title_fullStr	Political Connections and Tariff Evasion Evidence from Tunisia
title_full_unstemmed	Political Connections and Tariff Evasion Evidence from Tunisia
title_sort	political connections and tariff evasion evidence from tunisia
publisher	Published by Oxford University Press on behalf of the World Bank
publishDate	2018
url	http://hdl.handle.net/10986/30960
_version_	1764473274457128960

Political Connections and Tariff Evasion Evidence from Tunisia

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