African States Have Expanded Their Tax Bases, OECD Says

by Lorys Charalambous, Tax-News.com, Cyprus

04 April 2016

Tax revenues in African countries are rising as a proportion of national incomes, according to a new report released by the Organisation for Economic Cooperation and Development (OECD) and partners.

The report, Revenue Statistics in Africa, covered eight countries: Cameroon, Côte d'Ivoire, Mauritius, Morocco, Rwanda, Senegal, South Africa and Tunisia. These nations' tax burdens, as a percentage of gross domestic product (tax-to-GDP), ranged from 16.1 percent to 31.3 percent in 2014.

Since 2000, all of these countries experienced increases in their tax-to-GDP ratios. The size of these increases ranged from 0.9 percentage points in Mauritius to 6.7 percentage points in Tunisia. Morocco, Rwanda, and South Africa saw increases in their tax-to-GDP ratios of around five to six percentage points. In comparison, the OECD average of 34.4 percent was only 0.2 percentage points higher in 2014 than in 2000.

These states have boosted their tax take by increasing taxes on income and profits. Value-added tax revenues also increased substantially.

According to the report, of the eight countries, South Africa relies most on taxes on incomes and profits, with these revenues making up 51.2 percent of the tax mix in 2014. However, each of the countries rely on taxes on income and profits more than OECD countries on average.

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