Countries without VAT

Chapter 5 surveys the sales taxes of African countries that do not (yet) have a VAT and analyses the distortions, valuation problems, and definitional issues caused by these taxes. Although VAT is not without problems either—in design but particularly in administration—it appears to emerge as a superior consumption tax to the regimes currently in force in the non-VAT countries, such as Angola, Liberia, and Nigeria. But while a VAT can be potentially well designed and administered, by definition production taxes will always be plagued by distortions, valuation problems, and definitional complexities. In short, a VAT can, but other sales taxes cannot, be improved.