10/07/23

AFRICA: African Nations Gain $1.9 Bln in Additional Revenues After Combating Tax Evasion

As published on: english.aawsat.com, Monday 10 July, 2023.

African nations have successfully generated an impressive sum of 1.69 billion euros ($1.86 billion) in additional tax revenues through inter-country tax information sharing.

According to the 2023 African Tax Transparency progress report, unveiled during the 13th meeting of the African Initiative in Cape Town, South Africa, cooperation among African nations has effectively bolstered tax revenues, benefits, and penalties from 2009 to 2022.

The report, co-authored by the Global Forum on Transparency and Exchange of Information for Tax Purposes, the African Union Commission, and the African Tax Administration Forum, with support from the African Development Bank, showcases the progress made by 38 African countries in addressing tax evasion and other illicit financial flows through transparency and information exchange.

Additionally, five non-member countries participated in the study.

The release of the report comes at a time when African governments are intensifying their efforts to boost domestic resource mobilization in the face of adverse economic headwinds, including global inflation and escalating debt levels.

The Economic Cooperation and Development Organization estimates that Africa loses up to $60 billion annually in illicit financial flows.

South African Finance Minister Enoch Godongwana praised the African Initiative.

“Over the past eight years, the African Initiative has transformed the landscape of tax transparency in Africa and helped mobilize over 300 million euros ($329 million) of domestic resources,” said the minister.

Godongwana emphasized the importance of political will in the efforts to enhance tax transparency but acknowledged that more can be done, urging the African Initiative to strengthen the capacity of African countries to enhance information exchange standards and protocols.

Zayda Manatta, head of the Global Forum Secretariat, presented the report to participants.

“For the first time, an African country reported an additional tax collection of 10.6 million euros through the use of standardized reporting data,” said Manatta.

She added that 23 African countries are currently parties to the multilateral agreement on mutual administrative assistance in tax matters, which is the most comprehensive tool for all forms of cooperation in combating tax evasion, thereby significantly expanding the exchange of information networks.

 

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Africa Tax Evasion