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How civil society organizations can support the tax and accountability initiatives of revenue authorities


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Presentation by Andrew Itai Chikowore at the 7th annual ICTD meeting in Kigali on February 5th 2019.

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How civil society organizations can support the tax and accountability initiatives of revenue authorities

  2. 2. Outline 1. Capacity Building and Advisory for Tax and Accountability 2. Tax Transparency and Information Sharing 3. Tax Payer Education / Sensitization 4. Tax Payer Engagement: Awareness Raising and Campaigning 5. Accountability of Tax Revenue Expenditures 6. Challenges faced by Civil Society Organizations and opportunities 7. Direction for future research
  3. 3. A. Capacity Building and Advisory for Tax and Accountability • Civil Society Organizations have supported mainly through capacity building. • Africa Tax Administration Forum ATAF) is strengthening tax administration, tax compliance, tax audit and tax record keeping. • Through its capacity building program it is providing training on tax audit, Tax Treaties – Transfer Pricing and Research Methodology • African Tax Research Network (ATRN) is also providing Research Methodology training for tax administrators.
  4. 4. Capacity Building and Advisory for Tax and Accountability • ActionAid and the Tanzania Tax Justice Coalition (TTJC) is providing capacity building to Members of Parliament, Ministry of Finance and the Tanzania Revenue Authority on the link between tax collection and provision of quality public services.
  5. 5. Success on capacity building • Increase in revenue collection in Tanzania, Uganda, Zimbabwe • The question is on the revenue spending by the governments. • There are increased debates and engagement by parliamentarians on tax incentives, scrutinizing tax policy and conducting cost benefit analysis before granting tax incentives or making policy decisions. • Tanzania new finance Bill (law) limits the power of the Finance Minister to grant tax incentives. • Governments of Tanzania, Uganda, Mozambique, Malawi have started Double Taxation Agreement re-negotiations and cancellation. • Governments (Ministry of Finance in Tanzania) now consults CSOs to get advise on domestic resource mobilization and participating in pre-budget consultation processes (budgeting processes and tax reforms).
  6. 6. Continued.. • Tanzania has put in place a fully fledged unit that deals with international taxation of multinational companies • Uganda has a unit that focuses on taxation of high net worth individuals
  7. 7. B. Tax Transparency and Information Sharing • Tax Justice Network Africa, ActionAid and Oxfam are supporting campaigns to ensure tax transparency and information sharing. • To date tax information (Revenue Performance Reports) in Tanzania and Zimbabwe are published in the newspapers and revenue authority websites quarterly. • The Revenue Authorities are now been audited by the Auditor Generals Office annually. • Now all tax transactions are conducted electronically to enhance efficiency and transparency. • Governments now promoting country-by country reporting of revenue, assets, employees and other activities to enable public scrutiny of corporate tax policies
  8. 8. Tax Transparency and Information Sharing • Example of Lack of transparency and information sharing from the extractive industries in Tanzania • The government makes mining investment decisions without consulting the parliament because they are regarded as strategic investments despite the efforts from civil society for parliament scrutiny. • This has results in confrontations with communities and other key stakeholders who feel they are not part of the decision making process.
  9. 9. C. Tax Payer Education / Sensitization • Policy Forum, Tax Justice Network Africa and ActionAid are hosting joint taxpayer education workshops / breakfast meetings with revenue authorities to sensitize on new / reviewed tax policies • Trainings, seminars, road shows and street caravans are some of the mechanisms used to educate and sensitize tax payers. • Working closely with media (print and electronic to report on taxation issues for transparency and accountability purposes. • In Tanzania tax clubs have been instituted in secondary schools while tax studies are been instituted as part of primary school curriculum (tax education).
  10. 10. Continued.. • Development of simple tax justice content, curricular, tool kits and training materials for local consumption • Tax environment scanning, e.g. in Uganda ActionAid sensitized on the effects of the social media tax, Taxation of bloggers in Tanzania and tax loopholes in the extractive sector
  11. 11. D. Tax Payer Engagement: Awareness Raising and Campaigning • CSOs are raising awareness on the importance of paying tax to improve public confidence • In Kenya the National Tax Payers Association was formed in 2007 to to constructively engage with government and citizens on tax issues (clarification for the citizens) • Stakeholder engagement during pre-budget consultative meetings. • Civil society advocating for review of policies on behalf of the citizens (voice of the voiceless). E.g. the VAT and Tax Administration law in Tanzania • Use of youth and women's forums, debates and community meetings at local level especially on government expenditure. • Radio programs involving journalists at local and national level • Conducted tax online debates through Twitter
  12. 12. Continued • ActionAid – engaged in the tax justice campaign focusing on on corporate taxation and ending harmful tax incentives • Pressure has been put on governments to: 1. End the granting of harmful tax incentives resulting in tax competition and race to the bottom. 2. Establishing tax social movements that fight for tax transparency and accountability. 3. Making it social indefensible for companies to ask for tax incentives 4. Advocating for parliamentary scrutiny in granting tax incentives and tax policy and publishing tax incentives 5. Linking tax revenue with the provision of quality public services (public spending)
  13. 13. Accountability of Tax Revenue Expenditures • CSO Budgeting working groups hold governments accountable for revenue expenditure • Policy Forum (Tanzania), ZIMCODD (Zimbabwe) SEATINI (Uganda), are some of the organization analyzing government tax revenue collection and expenditure and advocating for transparency/accountability. • They are responsible for budget recommendation through pre-budget consultations • Use of media to hold the government accountable towards gender responsive Budgeting and public service deriver • Policy Forum has a platform to meet the Minister of Finance to deliberate of Tax issues (Progressive taxation )
  14. 14. Continued.. • In Zimbabwe government expenditure is published in gazettes as warrant of expenditure • However, government gazettes are sold and not easily accessible to everyone • There is need for CSOs to push for publication of government expenditure through newspapers, treasury websites and parliament websites
  15. 15. E. Challenges faced by Civil Society Organizations • Negative perception by government of the involvement of Civil Society Organization on tax issues (transparency and accountability). • Political interference – risk of been deregistered (shrinking civic space) • Governments are putting tough laws to restrict CSOs to conduct research, e.g. the Statistics law in Tanzania, Cyber laws etc • Non availability of data on African Tax trends e.g. Women and Tax , Youth and Tax , and Cost of Tax Avoiding • Difficult to acquire company tax information and contracts– risks of libel (E.g. Publish What You Pay initiative).
  16. 16. F. What are the opportunities? • Financing for Development Agenda – domestic resource mobilization • Progressive taxation to enhance equity • Solidarity of civil society with with international organizations, regional blocks (SADC, EAC, ECOWAS, and the African Union. • Governments has limited resources to develop capacitate of revenue authorities and Ministry of finance. • Civil society organization's have capacity to provide policy technical support
  17. 17. G. Direction for Future Research • Further research on progressive taxation (Property Tax , Wealth Tax , Tax in the formal sector and excise Tax) • Taxation in the specialized sectors of the economy e.g. Extractives, telecommunications, financial sector (banking, insurance, real estate, and non-bank micro-financing • Taxation and its impact on marginalized groups (including women and youth and people with disabilities )
  18. 18. •END//