By Melody Mwala
Africa is still grappling with low revenue collection efforts, thereby undermining the continent’s ability to sustainably develop.
The continent’s tax-to-Gross Domestic Product (GDP) ratios averaged 15.6 percent in 2021, a stark contrast to the Organization for Economic Co-operation and Development’s (OECD’s) average of 34.1 percent during the same period.
Speaking at the 5th African Tax Administration Forum – Heads of Tax Administration Master Class (ATAF-HTMC), held for the first time in Zambia, Zambia Revenue Authority (ZRA) Commissioner General Dingani Banda highlighted the pressing issue.
He noted that the continent’s low revenue collection is significantly hampering development, especially amid the increasing negative effects of climate change.
“One observes that the fundamental difference between the OECD and African countries is the level of digitalization of systems and processes, holding everything else constant,” Banda said.
Banda emphasized that digital transformation offers an unparalleled opportunity to modernize the tax system, improve compliance, and enhance the taxpayer experience.
By leveraging advanced technologies such as Artificial Intelligence, data analytics, and digital platforms for all pillars of taxation, Africa can streamline processes, improve accuracy, and increase operational efficiency.
He pointed out that these technologies allow tax administrations to gain valuable insights into taxpayer behavior, identify patterns of non-compliance, and tailor enforcement efforts to target high-risk areas.
However, Banda stressed that digital transformation is not solely about technology but also about people.
“As leaders, it is our responsibility to foster a culture of innovation, collaboration, and continuous learning within our organizations,” Banda stated.
He called for continuous investment in people, equipping them with the skills and knowledge needed to thrive in a digital world. By doing so, he believes that staff will feel empowered to embrace change, adapt to new ways of working, and deliver value to citizens.
The 5th ATAF-HTMC provided a platform for tax administration heads across Africa to share insights and strategies to tackle the continent’s revenue collection challenges.
As Africa continues to navigate these issues, the emphasis on digital transformation and capacity building remains crucial for sustainable development.
