This paper reviews the evolution and current state of subnational taxation in five large emerging countries: Brazil, Russia, India, China, and Nigeria – BRIC plus one. As these case studies show, intergovernmental fiscal relations in any country are inevitably both path-dependent and...

We use detailed micro-level data on consumption and income for a 1998-2004 panel of Russian households to study the effects of the flat income tax reform in 2001. We show that the gap between household expenditures and reported income is a meaningful measure of tax evasion. We use the...

Russia, Ukraine, and Kazakhstan have all carried-out comprehensive reforms of their inter-governmental fiscal systems in the decade since the inception of transition; and all three countries are in the process of considering or implementing far-reaching “second-generation” reforms in this...

Emerging economies in crisis typically request assistance from the International Monetary Fund (IMF). After evaluating the situation, the IMF makes a loan available to the country conditional on certain policy reforms. Governments usually resist many of these measures and negotiation ensues....

The current mechanism of fiscal equalization in the Russian Federation is complex, unstable and not transparent. In addition, it does not appear to be accomplishing its main goal: the equalization of funds among regions. While major reforms were introduced in 1994, serious problems remain in...

In 2001 the Russian government introduced a bold reform of its tax system, which included the adoption of a flat-rate income tax. Until then, only a few countries, including the transition countries of Estonia , Latvia , and Lithuania , had adopted a flat-rate income tax. This reform has...

This paper examines citizens’ attitudes toward paying taxes – what is sometimes termed their “tax morale”, or the intrinsic motivation to pay taxes – focusing on the experience of individuals in the Russian Federation. A unique aspect of our analysis is our ability to study tax morale...

This paper first restates the lessons to be learned from Richard Musgrave’s pioneering discussion of the tax assignment issue. Next, it considers subsequent developments in the theory of fiscal federalism related to the issue of tax assignment. Surprisingly little clear guidance is offered by...

In the early years of its existence, the Russian Federation adopted a system of differential treatment of its regions in order to cope with the great degree of diversity present in them. This paper examines the Russian Federation’s asymmetric federalism by evaluating the system’s role,...