{'fraction_non_alphanumeric': 0.017293997965412006, 'fraction_numerical': 0.004069175991861648, 'mean_word_length': 5.0, 'pattern_counts': {'":': 0, '<': 0, '<?xml version=': 0, '>': 0, 'https://': 0, 'lorem ipsum': 0, 'www.': 0, 'xml': 0}, 'pii_count': 0, 'substrings_counts': 0, 'word_list_counts': {'cursed_substrings.json': 0, 'profanity_word_list.json': 0, 'sexual_word_list.json': 0, 'zh_pornsignals.json': 0}}
Missing Imports and Tariff Evasion in Malawi: Do Tax Rates Matter?

The study analyzed 2013 bilateral trade data between Malawi and each of the following three trading partners; Mozambique, South Africa and China. Using data from the World Integrated Trade Solution (WITS), the study employed a simple Ordinary Least Squares (OLS) model to estimate the impacts of tax rates on tariff evasion and conducted some robustness checks. We found that tax rates applicable to Mozambique and South African Imports reduce the evasion gap. This is interpreted to mean that other countries' exports to Malawi are declared as originating from Mozambique and South Africa in order to enjoy the preferential rates of duty due to the bilateral trade agreements that exist between each of the two countries and Malawi. We also found out that tax rates have a positive significant effect on tax evasion of Chinese imports. Consequently, the paper established that higher tax rates induced tax evasion.