Africa to get together to solve tax problems

Tax collectors from 39 countries around the world meeting in an Organisation for Economic Cooperation and Development (OECD)-sponsored conference on Friday agreed to support a further conference specifically on taxation in Africa. The conference will be hosted by the South African Revenue Service (Sars), and will take place in May this year.

The conference, likely to be held in Durban, will for the first time bring tax commissioners from all over the continent together. The communiqué issued at the end of the OECD forum said that the conference would bring together not only the commissioners but also the OECD, the International Monetary Fund, World Bank, the World Customs Organisation and donor agencies.

The communiqué said: “We propose the conference in May considers the establishment of an international tax centre on the African continent with funding from donors and other interested parties.”

Explaining the proposal, the tax commissioner general of Uganda, Allen Kagina, said that the idea was to strengthen tax administration throughout Africa, and that capacity-building and exchange of ideas would result from the dialogue.

Efforts by international bodies in the past had been “disjointed”, Kagina said, and had not made much progress. She added that tax authorities anywhere on the continent would be able to be in touch with the centre to resolve problems that they faced.

Pravin Gordhan, the commissioner of Sars, said that one of the major problems being faced by a number of African countries was that they relied heavily on customs duties as their main source of revenue. With the reduction in tariff barriers and more open trade around the world, this was a diminishing resource. “A new tax base needs to be found,” he said.—I-Net Bridge