Cameroon is a bilingual (French and English) Central African country. Cameroon has been independent since 1960 and is a member of the Economic and Monetary Community of Central Africa (CEMAC). Its economy is mainly based on agriculture and non-oil natural resources. Following the discovery of oil in 1978, Cameroon experienced a period of sustained economic growth, but from 1986 onward has suffered economic crises due to internal and external reasons.

The country's central challenge is to overcome the persistence of high rates of poverty. This is one of the main objectives of the government's Poverty Reduction Strategy Paper (PRSP). In recent years, the international community has also supported the country's anti-poverty efforts. The implementation of the latest Growth and Poverty Reduction Facility (GPRF) of the IMF (October 2000 to September 2003) was characterized by a notable increase in public spending on poverty reduction programmes (e.g., education, health). The budgets of these programmes were raised through increases in subsidies and public borrowing. Other resources were also obtained from the HIPC initiative of the IMF and the World Bank and used for priority sectors of the economy such as basic infrastructures, education, health, and rural development.

Meanwhile, government anti-poverty programs are increasingly predicated on increases in tax revenues. Thus, tax reforms were initiated with a focus on the improvement of the tax system's efficiency and equity, the modernization of the tax administration to collect taxes, and the reform of indirect taxation, which paved the way for the introduction of the 1999 value-added tax (VAT) system.

Since the introduction of the VAT and the increase of the rate in 2004, the public debate has almost exclusively focused on the impact of these measures on government's revenue. The distributional and poverty impacts of this and other policies have almost escaped attention in this debate. CMRTSIM, which is a micro-simulation model of the household sector in Cameroon, has been built to evaluate the budgetary, poverty and income distribution implications of the current and alternative value-added tax (VAT) policies in Cameroon. Other policy modules that can help design effective anti-poverty policies will be added to the site in future.