Tax leaders discuss ways to reduce rate of debts in Africa

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By Mustapha Jallow

Scores of tax administrators and experts in West Africa on Wednesday discussed a way forward to reduce the high rate of debts in Africa and improve more on domestic revenue mobilization. 

“We have seen in West Africa countries that the debts are too much. People are asked to pay heavy taxes and we don’t know where these taxes are put into. So, we are gathered together to discuss and know where our governments are investing these tax monies to,’’ remarked Saliou Dieye, tax adviser – who doubled as president for West Africa Union of Tax Institutes (WAUTI).

President Dieye was speaking at the 9th edition of the international tax conference, hosted in Banjul by the Gambia Revenue Authority (GRA). Themed: “Rethink taxation for human development and economic prosperity’’, the event was organized by WAUTI in collaboration with GRA, brought together tax administrators, experts, governing council and member-bodies across West Africa.

According to organisers, the event provides an opportunity to regional leaders to discuss contemporary issues in taxation and allow them to critically analyse the roles and responsibilities of all the relevant stakeholders involved in the edition of taxation in Ecowas region.

Ecowas-Gambia representative Miatta Lily French, who was speaking on behalf of the Ecowas president, talked about the outbreak of Covid-19 and ongoing war between Russia/Ukraine, which she added had made it abundantly clear that high dependence on external sources of income, is not tenable for Africa.

“African governments need new strategies to enhance internal revenue collections in order to fulfil their obligations – not the least being the payment of community levy to Ecowas,’’ she urged, while reading Ecowas president’s statement.

In the statement, she showed Ecowas’ commitment to continue its support to the WAUTI,to ensure it achieve its goals. She further spoke on the importance of taxation, which she said plays crucial role in ensuring the equitable sharing of wealth. Also, she said the government expenditures funded by taxation are essential to guaranteeing access to basic services to all including the poor and disadvantaged groups that face discrimination.

The hostile effects caused by the Covid-19 and the ongoing war between Russia/Ukraine, Seedy Keita, the minister for finance said, public policy should focus more on mobilising tax revenue and rationalising public expenditures to reduce debt vulnerability.  

“As low-income country, The Gambia and other regional countries suffer from large infrastructure deficits. And public expenditure in infrastructure must be carried out to improve the factors of growth in order to support revenue performance and resilience. It is important to ensure public investments do not further worsen the vulnerabilities in an already tied fiscal space characterized by low performance of international revenues from taxation,” said Keita.

“As we all know, taxation is a crucial component of any functioning society. It provides the necessary funds for government to invest in public goods and services, such as education, health care, infrastructure amongst numerous others. It is also true that the way in which we tax can have significant impacts on our societies. For example, a tax system that is overly burdensome or unfair can hold back growth and affect human development. On the other hand, a well-designed tax system can promote economic prosperity and improve the well-being of the citizenry and put countries on a path to economic prosperity,’’ remarked Yankuba Darboe, the Commissioner General for GRA – who doubled as chairman for the West African Tax Administration Forum (WATAF).

Darboe also talked about the major infrastructures, particularly Banjul Rehabilitation Project, which he added that was fully funded with tax revenue. He said African governments are now become more responsive to the needs of their citizens who are craving for economic prosperity.

By 2050, according him, the African youth population will constitute about 20% of the global youth population, saying more than 60% of Africa’s population is under the age of 25, with 70% of sub-Saharan Africa under the age of 30.

“It could be a blessing if the African continent is able to stimulate the economy to give this youthful population the right economic environment to thrive and prosper, and like China, uplift a significant number of them out of poverty,” said GRA’s head.

Meanwhile, WAUTI is an umbrella organization established by the Chartered Institutes Taxation of Nigeria (CITN) and the Chartered Institutes of Taxation of Ghana, with the objective of developing and promoting the tax profession in West Africa. Every year, WAUTI bring together taxation professionals across the continent to brainstorm new ideas to ensure accountabilities and transparencies are promoted in Africa.

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