Tax Policy and Enterprise Development
in South Asia








Overview   Background   Objectives   Methodology   Outcomes   Partners
   Research Themes
   User Participation
   Data Collection & Analysis
   Gender Considerations
   Ethical Considerations
   Organizational Matters
   Project Timeline
   Research Teams

Conceptual and Theoretical Framework


Program Methodology

  The programme duration will be 3 years, (36 months). It will also include an Annual Workplan which provides a detailed breakdown of work, assignment of tasks and responsibilities, budgetary outlays, and deadlines for completion and submission of research outputs under the 3 research themes described below. These outputs will go through 2 peer review cycles before being presented at Policy Engagement Workshops conducted by focal institutions in Pakistan, India, Sri Lanka, Bangladesh, and Nepal. The peer review will also invite inputs from the independent Technical Advisory Group (details provided in the following section). GINI will also develop a project web-site featuring:

  • Internet database where research outcomes will be posted at various stages of completion

  • Online forum for real-time communication amongst research partners

  • ‘Progress’ page which will track and share details of programme activities to ensure all partners are kept abreast of latest developments, ensuring that momentum of work and partner cohesion are maintained throughout the programme cycle

  The research themes identified constitute the research agenda for Year 1, 2, and 3. At the end of each Year, a new Annual Workplan will be developed by GINI to achieve the programme objectives throughout the year, through consultations with research partners and the approval of the Steering Committee.

The diagram depicts the conceptual framework for the research, and provides the basis for the following research themes and questions that the project will explore:

Research Themes
Theme 1: The Impact of Tax Exemptions and Concessions on Enterprise Development

What is the extent to which small enterprises face biases in tax exemptions and incentives?

What is the extent to which these biases disproportionately impact small enterprises operating in the undocumented economy and/or those owned/managed by women?

What are the impacts of tax exemptions and concessions on entrepreneurs and SMEs in terms of enterprise performance and productivity, (including any disproportionate impacts on women informal entrepreneurs)?

What are the impacts of biased tax regimes on emigration of entrepreneurs and skilled labor, the extent to which this contributes to ‘brain drain’ in South Asian countries

Theme 2: The Impact of the Value-Added-Tax (VAT) on Enterprise Development

What are the progressivity impacts of VAT burden on small enterprises and workers (particularly those operating in the undocumented economy), in terms of labor market outcomes, entrepreneurship and productivity at the bottom-income spectrum and in low value-added sectors?

How are entrepreneurs (particularly those owning/managing small enterprises in the undocumented economy, especially women entrepreneurs) treated by VAT administration systems, against indicators of compliance costs and taxpayer friendliness?

Theme 3: The Impact of Property Tax on Enterprise Development

What are the weaknesses in property tax systems that create and/or sustain informal land markets at the local levels, (including weaknesses in policy, administration, capacity and resources)?

What is the nature and magnitude of impacts of land informality on entrepreneurs (owning/manaing small enterprises) and workers (employed by small enterprises) operating in the undocumented economy (especially women)?

The regional scope of the project will allow the research to:

  • Highlight similarities and differences in the institutions, regulatory and policy frameworks

  • Identify and explain regional patterns and trends over time

  • Evolve best practices for reform design, sequencing and implementation under adverse conditions



(C) 2012 at GINI, Islamabad-Pakistan