Africa Needs Enhanced Tax Collection Systems, Says Dr. Patrick Olomo at ATAF Annual Meeting
Dr. Olomo presented a paper titled “Strengthening International Cooperation: A United Front Against Illicit Financial Flows (IFF)” at the ATAF Annual Meeting in Cape Town on November 2, 2023.
CAPE TOWN, South Africa — Africa needs enhanced tax collection systems supported by trade and investment to safeguard against external shocks, as well as legislation to protect tax bases, according to Dr. Patrick Olomo, Acting Head of the Economic Policy and Sustainable Development Division at the Africa Union Commission, writes Rachel Mkundai.
Speaking at the just-ended ATAF Annual Meeting in Cape Town on November 2, 2023, Dr. Olomo presented a paper titled “Strengthening International Cooperation: A United Front Against Illicit Financial Flows (IFF).”
He explained that active engagement in global tax reforms should start with a Continental dialogue on inclusive and effective tax cooperation.
This dialogue should involve various African institutions and guide future discussions to ensure Africa’s interests are represented.
Improved tax collection systems and revenue generation could generate an additional $220 billion in revenue, with cross-border transactions and e-commerce potentially generating $40 billion in revenue by 2023.
Dr. Olomo added that regional harmonisation and protection of tax bases through legislation should be implemented to protect tax bases from losses due to incentives.
Chenai Mukumba, Executive Director of Tax Justice Network Africa (TJNA), contributed to the discussion as a panellist.
She mentioned that TJNA will be conducting validation meetings with Member States, facilitated by the African Union Commission (AUC), to ensure the Policy Tracker Tool on Illicit Financial Flows (IFFs) is fit for purpose and builds upon existing efforts.
“Once finalised, the tool will be presented to relevant AU policy organs for consideration and endorsement. This highlights the importance of collaborative validation and the endorsement process to ensure the tool’s effectiveness and acceptance,” Mukumba commented.
The Two-Pillar Solution acknowledges the calls from developing countries for more mechanical, predictable rules. More generally, it redistributes taxing rights to market jurisdictions based on where sales and users are located.