This annual publication compiles comparable tax revenue and non-tax revenue statistics for 36 countries: Botswana, Burkina Faso, Cabo Verde, Cameroon, Chad, Republic of the Congo, Democratic Republic of the Congo, Côte d’Ivoire, Egypt, Equatorial Guinea, Eswatini, Gabon, Ghana, Guinea, Kenya, Lesotho, Madagascar, Malawi, Mali, Mauritania, Mauritius, Morocco, Mozambique, Namibia, Niger, Nigeria, Rwanda, Senegal, Seychelles, Sierra Leone, Somalia, South Africa, Togo, Tunisia, Uganda and Zambia. The report extends the well-established methodology on the classification of public revenues set out in the OECD Interpretative Guide to African countries, thereby enabling comparison of tax levels and tax structures across the continent and with other regions. This edition includes a special feature on facilitation and trust as drivers of voluntary tax compliance. The publication is jointly undertaken by the OECD Centre for Tax Policy and Administration, the OECD Development Centre, the African Union Commission and the African Tax Administration Forum, with financial support from the governments of Ireland, Japan, Luxembourg, the Netherlands, Norway, Spain, Sweden, Switzerland and the United Kingdom and from the European Union.
Revenue Statistics in Africa 2024
Abstract
Executive Summary
Revenue Statistics in Africa 2024 presents internationally comparable indicators on tax and non-tax revenues up to 2022 for 36 African countries, including Mozambique, Somalia and Zambia for the first time. The Revenue Statistics in Africa initiative is a unique tool for tracking progress in domestic resource mobilisation and for informing the design and analysis of tax policy across Africa. As such, it contributes to the United Nations’ Sustainable Development Goals (SDGs), the Addis Ababa Action Agenda and the African Union’s Agenda 2063. It also contributes to the implementation of the second phase of the Pan-African Statistics Programme, a joint initiative between the African Union and the European Union that aims to improve measurement of progress in the process of African Integration by promoting the use of statistical data of quality in the Africa Integration decision making process and policy monitoring. This edition of Revenue Statistics in Africa includes a special feature on Facilitation and Trust as Drivers of Voluntary Tax Compliance in Selected African Tax Administrations.
In 2022, the average tax-to-GDP ratio (total tax revenues including social security contributions as a percentage of GDP) for the 36 countries in this publication was 16.0%, an increase of 0.5 percentage points (p.p.) relative to 2021. This was the second consecutive annual increase, following a rise of 0.3 p.p. in 2021; as a result, Africa’s average tax-to-GDP ratio was 0.5 p.p. above its level prior to the COVID-19 pandemic (15.5% in 2019). However, average tax revenues in Africa remained below the levels in Asia and the Pacific (19.3%), Latin America and the Caribbean (LAC, 21.5%), and OECD countries (34.0%) in 2022. Tax-to-GDP ratios varied widely across African countries in 2022, from 2.6% in Somalia to 33.5% in Tunisia; 19 of the 36 countries recorded a ratio below 15%.
Tax revenues as a percentage of GDP increased in 23 countries, decreased in 11 and remained unchanged in two between 2021 and 2022. Chad and the Democratic Republic of the Congo recorded the largest increases in their tax-to-GDP ratio, of 3.3 p.p. and 3.6 p.p. respectively, driven by significant increases in corporate income tax (CIT) revenues on the back of higher profits from the extractive sector. By contrast, the largest declines occurred in Mali and Sierra Leone (1.9 p.p. in both cases), due to declines in revenues from taxes on goods and services caused by trade disruption in both countries.
Despite a challenging macroeconomic context characterised by high inflation and a slowdown in growth, all 36 countries except Mali recorded increases in nominal GDP and in nominal tax revenues in 2022. Higher CIT revenues drove the increase in tax revenues, rising by 0.4 p.p. on average across the 36 countries due primarily to growth in profits from the oil and gas sector attributable to higher commodity prices. Meanwhile, revenues from taxes on goods and services increased by 0.1% of GDP in 2022. Within this category, revenues from VAT and import duties both increased by 0.1% of GDP on average while excises decreased by 0.1% of GDP. Revenues from personal income tax (PIT) and social security contributions remained unchanged.
Higher tax-to-GDP ratios in many African countries over the last ten years reflect ongoing efforts to enhance fiscal systems. Between 2013 and 2022, the Africa average tax-to-GDP ratio rose by 1.1 p.p. while the averages for the LAC region and OECD countries increased by 0.8 p.p. and 1.4 p.p. respectively. Tax-to-GDP ratios rose in 25 of the 36 African countries between 2013 and 2022 and declined in 11.
All main revenue categories increased between 2013 and 2022 at approximately the same pace as a share of GDP. Income tax revenues increased by 0.4 p.p. while revenues from taxes and goods and services grew by 0.5 p.p. Taxes on goods and services remained the main source of tax revenues in Africa in 2022, accounting for an average of 51.3% of total tax revenues, with VAT accounting for 27.0%. Within this category, trade taxes declined as a percentage of total tax revenues but increased by 0.1% of GDP. Meanwhile, taxes on income and profits accounted for 39.3% of total tax revenues on average in 2022: 16.2% from PIT, 21.2% from CIT and 1.9% that was unallocable between them.
Non-tax revenues in Africa in 2022 amounted to 6.2% of GDP on average among the 35 countries reporting data on these revenues for that year. Non-tax revenues ranged from 0.7% of GDP in South Africa to 23.7% in the Republic of the Congo. Non-tax revenues exceeded 10% of GDP in five countries, three of which (Botswana, Lesotho and Namibia) received most of their non-tax revenues from the Southern African Customs Union (SACU) Common Revenue Pool. Non-tax revenues were higher than tax revenues in Botswana, Equatorial Guinea, Lesotho and the Republic of the Congo.
In 2022, average non-tax revenues in Africa increased by 0.4 p.p. of GDP from the previous year. This increase was driven by increases of 0.4 p.p. in both revenues from rents and royalties and from other property income (e.g. interest and dividends) amid rising commodity prices, though it was partially offset by a decline in SACU revenues. In contrast, grants remained unchanged between 2021 and 2022.
Higher oil and gas royalties, interest and dividends drove the largest increases in non-tax revenues as a share of GDP, which were found in the Republic of the Congo and Equatorial Guinea (8.7 p.p. and 13.3 p.p. respectively). For the first time, this edition of Revenue Statistics in Africa analyses the highly detailed information on extractive-related revenues provided by participating countries.
Sources of non-tax revenues varied by country in 2022. Most non-tax revenue came from grants for nine countries whereas the majority was derived from rents and royalties in eight countries. The remaining 14 countries, excluding the four net recipient SACU countries, relied more on other sources of non-tax revenues, such as interest and dividends and fees for goods and services.
Between 2013 and 2022, average non-tax revenues decreased by 1.1 p.p. of GDP mostly due to declines of 0.5 p.p. in grant revenues and of 0.8 p.p. in other non-tax revenues (mostly SACU revenues). This decline offset the increase in tax revenues over the same period, underscoring the financing challenges African countries face as they look to achieve the SDGs against a backdrop of rising debt levels and higher spending needs in the wake of the COVID-19 pandemic.
The special feature chapter written by ATAF examines the role of facilitation and public trust in driving voluntary tax compliance as a means of increasing revenue levels across African countries. The chapter identifies good practices by tax administrations in selected African countries, including innovations in the digitalisation of tax systems and taxpayer education programmes. However, increased funding is needed to enable greater automation of tax systems and seamless exchange of information across government agencies. In order to enhance trust in African tax systems and thus drive voluntary tax compliance, African tax administrations and other government agencies also need to work together to demonstrate that tax revenues are put to good use.
