Domestic resource mobilisation and the transition to sustainable development: synthesis of Asia case studies

Abstract

Official development assistance on its own will be insufficient to meet the financing demands of the Sustainable Development Goals. There is therefore a renewed international focus on the role of domestic resource mobilisation in sustainable development. Historically, increases in taxation have been associated with the development of more accountable and effective institutions, and increasing levels of social expenditure. While low tax-to-GDP ratios tend to be a characteristic of poorer countries, this may be a symptom rather than the cause of underdevelopment. This report is based on case studies of the tax performance of 6 Asian countries: Bangladesh, China, India, Indonesia, Nepal and Pakistan. This allows for a comparison between 3 relatively large and rapidly growing middle-income Asian economies (China, India and Indonesia) and 3 more aid-dependent low- and middle-income countries (Bangladesh, Nepal and Pakistan) – which are also major Department for International Development client countries. This research was funded under the Department for International Development’s Policy Research Fund