Boosting domestic revenues for development

02/04/2009
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Bank support to tax policy and administration in Africa

Improving revenue administrations during times of economic downturn was one of the key challenged discussed at an international seminar on cooperation on tax policy and revenue administration in Fes, Morocco from March 30th – April 1st 2009.

The seminar was organized by the General Tax Administration of Morocco and the OECD Center for Tax Policy. It gathered over 60 tax officials and representatives of international organizations from around the world, including the AfDB.

Commenting on the adverse impact of the  economic crisis  Carlos Santiso, Sector Manager for Governance – stated how  the crisis is reducing the fiscal space and stressed that “generating and administering national revenues is one of the most important functions of a state, a foundation upon which all else depends.” The seminar exchanged lessons learned and good practices in tax reform and progress being made in revenue management. African participants recognized that developing a solid revenue administration and a fair tax system contributes to building states, financing development priorities and reducing dependency on external funding. The seminar also called for greater efforts to combat corruption and bribery in tax policy and administration.

The need of mobilizing domestic revenues in an efficient, transparent and fair manner was also underscored most recently Doha’s International Conference on Financing for Development in 2008. It also matters for building capable states, encouraging engaged societies and strengthening domestic accountability. As Santiso stated, “effective revenue governance is part of a broader process towards an African-led agenda for good governance and a central thrust of the Bank’s strategy in support to such agenda”.  

Delegates from African countries (Ghana, Kenya, Malawi, Morocco, Rwanda, Senegal, South Africa, Uganda and Zambia) also discuss the establishment of the African Tax Administrations Forum (ATAF), which is receiving support by the Bank’s governance department. Mr. Santiso reaffirmed the Bank’s support to ATAF, following President Kaberuka’s endorsement of this initiative at its launching conference in Pretoria in August 2008. ATAF aims to become a platform for articulating African tax priorities, anchoring good practices, and building capacity in African tax policies and revenue administration through peer learning and knowledge development.