Payment for privilege? Race and space in the politics of taxation in Brazil and South Africa

This dissertation addresses the question of why Brazil and South Africa, two highly unequal, upper-middle-income countries, developed such different tax structures during the course of the 20th century. It argues that historically-constructed definitions of National Political Community (NPC), varying in terms of how racial and spatial cleavages were addressed in critical constitutions written around the turn of the century, strongly influenced the development of tax policy and administration. Definitions of NPC structured the collective identities and relative cohesion of class actors in the respective societies, in turn affecting the willingness of citizens to accept state demands for tax payment.;The argument and a series of rival explanations are considered through a nested research design, which integrates comparative historical analysis of state development in Brazil and South Africa with a statistical analysis of a multi-country dataset. The analyses provide complementary and strong evidence for the central hypotheses. Despite the similar socio-economic profiles of the two countries, the development of a racially-exclusionary union in South Africa led to the development of an efficient and progressive tax system, while the creation of an officially non-racial federation in Brazil resulted in the development of a largely regressive and inefficient tax system. In South Africa, race has served as a political "glue" creating political cohesion among higher-income individuals and firms, and a degree of cross-class solidarity with "poor whites." In Brazil, physical space, or regionalism, has been politically divisive, leading to class fragmentation and polarization. In the wake of such class relations, the South African state executive was able to secure high levels of willingness to pay from upper-income South Africans, while the Brazilian state executive met significant resistance, and the state was forced to collect taxes more indirectly, with higher levels of "fiscal illusion." Moreover, the dissertation highlights the various mechanisms of reproduction which have maintained these distinctive tax states even in the late 20th century. The multi-country statistical analysis demonstrates that the findings have broader explanatory power, as varied configurations of race and space are found to be robust predictors of tax collection around the world.