collection.<sup>30</sup> The WDR 2017 proposes that it is possible to make progress by (a) shifting the incentives and preferences of those with power; (b) paying more attention to the interests of previously-excluded participants; and (c) enhancing the contestability of the decision-making process. As with the framework developed here, the WDR ascribes a central role to building trust and to expanding fairness: “delivering on commitments feeds...back into building trust in institutions and strengthening outcome legitimacy”. This is most likely where government actions “resonat[e] with peoples’ needs and perceptions of fairness”.<sup>31</sup> Operationally, more effectively navigating the political barriers to reform—by explicitly considering power as a relevant factor— is likely to involve a combination of opportunism in identifying political opportunities for reform, strategies designed to build a sustainable political foundation for reform, and more effective approaches to assessing the extent of political commitment to reform.

Finally, where governments invest in building trust in tax systems this can directly and indirectly contribute to strengthening the broader fiscal contract. Strategies that focus exclusively on strengthening enforcement risk ignoring the broader social objectives of tax systems, as they offer no mechanism for increasing the likelihood that revenues will be used to provide public benefits. By making expanded trust central to reform, these broader goals are given greater prominence. Expanded trust in tax systems will often be achieved precisely by improving public benefits from taxation through greater equity, reciprocity and accountability. Meanwhile, recent research has argued that where fairness, equity, reciprocity and accountability feature more prominently in tax reform, this can serve to empower taxpayers to make more successful demands of governments for improved outcomes. Finally, pursuing these same goals can strengthen the potential statebuilding role of taxation – and thus the competence of governments to deliver benefits to taxpayers.<sup>32</sup> Critically, investments in enforcement and in building trust are complementary, rather than distinct strategies. Taxpayers are more likely to comply when: (a) the likelihood of detection, and penalties for non-compliance, are higher (“Enforcement”); (b) when it is relatively easy and low cost to comply (“Facilitation”); and (c) when they have a higher intrinsic willingness to pay – either because they believe that paying taxes is “the right thing to do”, that taxes are fair, or because they believe that taxes will be translated into public benefits (“Trust”). Importantly, these elements reinforce one another. A key component of trust in the tax system is a belief that everyone pays their fair share and is punished fairly if they do not. This depends on the existence of adequate enforcement.<sup>33</sup> Meanwhile, where there is little trust it may be impossible to mobilize the necessary _political commitment_ to strengthen enforcement capacity. Investing in strengthening trust is thus very centrally about also creating a supportive political environment for expanded enforcement.

> 30 Moore, M. (2017). The political economy of long-term revenue decline in Sri Lanka. _ICTD Working Paper 65_ . Brighton: International Centre for Tax and Development.; Hassan, M, & Prichard, W. (2016). The political economy of tax reform in Bangladesh: Political settlements, informal institutions and the negotiation of reform. _Journal of Development Studies_ , 52 (12):1704-1721.

> 31 World Bank Group. (2017). _World development report 2017: Governance and the law_ . Washington, DC: World Bank. 32 Prichard, W. (2015). _Taxation, responsiveness and accountability in developing countries: The dynamics of tax bargaining_ . Cambridge: Cambridge University Press; Prichard, W. (2016). What have we learned about taxation, state building and accountability? _ICTD Summary Brief 4_ . Brighton: International Centre for Tax and Development.; Jibao, S, & Prichard, W. (2015). The political economy of property tax in Africa: Explaining reform outcomes in Sierra Leone. _African Affairs_ , 114 (456): 404-431 33 Touchton, M., Wampler, B., & Peixoto, T. 2019. “Of governance and revenue: Participatory institutions and tax compliance in Brazil.” _World Bank Policy Research Working Paper 8797._ Washington: World Bank.

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