The African Tax Administration Forum (ATAF) has ended a high-level tax policy dialogue in Kigali, Rwanda, with a conclusion to improve tax policies that will enhance domestic resource mobilization.
The African Tax Administration Forum (ATAF) is an organisation which was established by African revenue authorities in 2009, in order to improve the performance of tax administrations in Africa.
The tax policy dialogue hosted by the Rwanda Revenue Authority (RRA) is the second edition of ATAF’s High-level Tax Policy Dialogue that is aimed at harmonizing and strengthening Africa’s position in the international tax arena.
A dispatch from the ATAF indicates that over 120 officials from Ministries of Finance and African tax administrations of 21 countries, parliamentarians, civil society, business and other top financial institutions, including the African Development Bank, were represented at the dialogue.
Liberia, being a member country of ATAF, was represented at the dialogue in Kigali by Decontee King-Sackie, Acting Commissioner General of the Liberia Revenue Authority (LRA).
Former LRA Commissioner General, Elfrieda Stewart Tamba, was also in attendance. It may be recalled that, while at the helm of the LRA, Madam Stewart Tamba was on November 7, 2016 elected to the Governing Council of ATAF as a member in Durban, South Africa. Her tenure at the LRA expired on June 30, 2018.
With intent of discussing how reinforce Africa’s position to benefit from the global tax agenda, the Minister of Finance and Economic Planning of Rwanda, Dr. Uzziel Ndagijimana, said African tax to Gross Domestic Product (GDP) ratios are far below those of Organization for Economic Cooperation and Development (OECD), and therefore there is a need to improve the tax position of the continent.
The Rwandan Minister stressed the need to bring together key players who are able to influence and take action to bring about the needed changes in Africa’s tax administration; naming politicians, legislators, Ministers of Finance, tax administrations, business and civil society groups as those to work together to effect the change.
He also acknowledged the role of ATAF for taking the lead in driving forward the initiative which will be a vital element in Africa achieving the African Union (AU) 2063 agenda which calls for a strategic framework for the socio-economic transformation of past and existing continental initiatives for growth and sustainable development.
In response, participants at the dialogue welcomed the call and commended ATAF for taking the initiative in leading the work on taxation changes in Africa.
They conceded that Legislators, Ministers of Finance and tax administration need to immediately start working closely together to design new tax policies for Africa and rapidly build tax administration capacity.
“African tax experts, academics and civil society have a key role to play in pioneering African tax solutions. There is a need for a framework to be established where African tax issues can be discussed and addressed,” the participants concurred.
Participants also said vital global tax issues such as the Base Erosion and Profit Shifting outcomes will be reviewed in 2020 and the OECD report on the tax challenges of digitization will be completed the same year.
Therefore, they said, “It is crucial that the African Union, Ministers of Finance, tax administrations, civil society and business participate actively in this work and influence its outcomes to ensure they are fit for purpose in Africa and assist in improving Domestic Resource Mobilization (DRM) on the continent.”
In a mandatory request, the participants agreed that ATAF monitors and evaluates progress on the global tax work carried out by Africa; calling upon it to set targets for that work and as soon as possible report progress on those targets to Finance Ministers at the next African Union meeting.
The meeting also highlighted that the expected change in African tax policy will require countries to work collaboratively to ensure that the outcomes meet the needs of all African countries.
To do so, participants emphasized that African countries will need to pool their resources to create the capacity needed to deal with those highly complex technical policy issues, noting that Africa must have an African inter-government tax policy body with ATAF as its technical support.
The participants further noted that good tax policy is based on good tax data, and therefore policy makers need data and rigorous data analysis on the impact of tax policy changes and tax administration reforms.