Chapter 4 | Page 160 4.3.2 Process challenges: Optimising fiscal and monetary policies While the structural factors identified above are fundamental to the effectiveness of the revenue regime, implementation of these policies is often the most challenging process. Challenges include those associated with implementing revenue policies, including optimal tax administration, tax efficiency and compliance, and managing debt sustainability. 4.3.2.1 Optimal tax administration Ineffective tax administration is one of the main constraints on the ability of States to collect revenues in general and direct taxes in particular.92 Low revenue collection in many developing countries is a result of factors such as lower growth, institutional weakness and dependence on trade taxes,93 and the general weakness of government and institutional capacity. The inability of governments in many poor countries to improve personal income tax collection has been linked to a narrow tax base, administrative and political weakness, poor capacity to expand the tax base, and resistance from wealthy segments of the society.94 Policies aimed at reforming and strengthening the institutions of taxation and revenue collection have potentially negative effects such as increased corruption, which generates more money for tax collectors and less for the public coffers.95 The efforts by donors to reform taxation systems in developing countries are generally geared towards improving tax policy and design, creating effective tax administration and enhancing constructive State-society engagement on tax issues.96 Accordingly, improvements in tax administration can result in high gains inefficiency and reduce leakages from corruption and other malpractices. 92 Odd-Heige Fjeldstad and Joseph Semboja, 'Why people pay taxes: The case of the development levy in Tanzania' (2001) 29(12) World Development 2059–2074. 93 Delamonica and Mehrotra, above n 21, 90. 94 Fjeldstad, above n 8. 95 Stiglitz, above n 29. 96 Fjeldstad, above n 8.