Countries of the world are facing increasing challenges in funding their national budgets, and this has placed much pressure on nations’ tax authorities to up their skills in expanding the tax net with special focus on underground economies. This study adopted a literature review approach on contemporary tax revenue mobilization approaches around the world. Data were collected from online sources using phrases such as tax collection from informal sectors; tax revenue collection from shadow economies; taxation of underground economies; methods of taxation on traditional economies. In line with reviewed literature as well as the collaborative synergy expected from governments, tax authorities, labour/employees associations, and informal sectors’ associations, the work adopted the stakeholder theoretical framework. The study identified the following as the mostly applicable international best practices in tax revenue mobilization from underground economies: indirect taxes (that is value added tax (VAT) and withholding tax (WHT)); presumptive tax; the formalization of informal sector; and collective tax collection regimes. It is the recommendation of the study that governments of the world (most especially those of emerging economies and third world countries) should improve their synergy with tax payers and associations in the informal sectors. This is because they form the largest population of qualified tax payers outside the tax dragnet.
Wahua, L., Kwode, I. E., Chukwuma, I. R., & Attipoe, J. K. (2022). Review of contemporary best practices in tax revenue mobilization from underground economies. International Journal of Latest Technology in Engineering, Management & Applied Science, 12, 38-48. DOI: 10.51583/IJLTEMAS