The document discusses the transition from the Millennium Development Goals (MDGs) to the new Sustainable Development Goals (SDGs) and what is needed to accomplish the more comprehensive SDGs. It notes that trillions, rather than just billions, will be required annually to achieve the SDGs. Domestic resource mobilization, including improving tax administration systems and compliance, can provide much of the financing needed from developing countries themselves rather than relying on international aid. Effective tax administration requires political will, clear strategies, and resources to facilitate compliance, enforce rules, and improve governance.

1. Project for Financing for Development
By Tekaling Gidi
December 2015

2. The ground rule for the new SDG and the
Past MDG
• The sustainable development goals (SDGs) are a new, universal set of
goals, targets and indicators that UN member states will be expected to
use to frame their agendas and political policies over the next 15 years.
• The SDGs follow and expand on the millennium development goals
(MDGs), which were agreed by governments in 2001 and are due to
expire at the end of this year.

3. The MDG:
the global development agenda from 2000 until
2015.

4. Why we need SDG???
• The MDG goals made no mention of human rights and did not
specifically address economic development. While the MDGs, in
theory, applied to all countries, in reality they were considered targets
for poor countries to achieve, with finance from wealthy states.
Conversely, every country will be expected to work towards achieving
the SDGs.

5. The new SDG Goals

6. • The sustainable development goals (SDG) are a reflection of the
situation in the world today. According to Jan Eliasson, the SDG
reflect that the world need peace, development and human rights. The
year 2015 offers a unique opportunity for global leaders and people to
end poverty and to transform the world to better meet human needs
and the necessities of economic transformation, while protecting our
environment, ensuring peace and realizing human rights.

7. What we need to accomplish the SDG???
• In order to accomplish the SDG we need International perspectives as
well as regional, national and local perspectives. These goals are many
and complex than the MDGs.

8. What are the sources of finance for SDG?
• We have to go from billion to trillions. Trillions of will be needed
every year. “We need to radically rethink how we unlock resources
and connect the billions of dollars in official development assistance
(ODA) to trillions in investment of all kinds, public and private,
national and global.”

9. • The global community provides roughly $135 billion a year in official
development assistance, according to the Organisation for Economic
Co-operation and Development (OECD). But the SDGs are ambitious,
and the cost of achieving them will far exceed current development
funding.

10. • The largest potential sources of finance for development come from
countries themselves and private investors. International financial
institutions such as the World Bank Group can help countries get the
money they need for development through better tax policies, more
efficient public spending, and private investment.

11. The time of SDG
• The SDGs will be officially adopted at a UN summit in New York in
September, and will become applicable from January 2016. The
deadline for the SDGS is 2030.

12. Implementation of SDG
• Implementation and realization of the goals is crucial at the
international, nation al and local levels.

13. What is the Key to achieve SDG?
Especially for Africa!

14. Domestic Resource Mobilization
• Domestic Resource Mobilization is the most resource available to implement the SDG
• Domestic Resource Mobilization (DRM) — the process in which countries
transparently raise and spend their own funds to provide for their people – is the long-
term path to sustainable development finance. DRM doesn’t have to mean new taxes or
higher tax rates — governments often see their revenues rise through improved audits or
simplified filing processes. Improvements in tax compliance and revenues can, and often
do, enable countries to lower tax rates.

15. • The growth and scale of domestic resources in the developing world
are impressive; for example, total domestic sources of revenue grew in
the 54 Sub-Saharan African countries from $100 billion in 2000 to
nearly $513 billion in 2011 according to the African Economic
Outlook.
• Contrast that with the growth of ODA during the same period, which
went from $20 billion in 2000 to approximately $60 billion in 2011.

16. Tax Administration System for Effective
Domestic Resource Mobilization
• How a tax system is administered affects its yield, its incidence, and its efficiency.
• Three ingredients are essential to effective tax administration: political will, a clear
strategy, and adequate resources.
• Administration that is unfair and capricious may bring the tax system into
disrepute and weaken the legitimacy of government.

17. • The three major tasks of an effective tax administration are facilitating
compliance by ensuring that individuals obligated to pay taxes are doing so
and to try and make compliance easier for the taxpayer; enforcing compliance
and reducing tax evasion; and improving governance to keep tax officials
honest and reinforce the legitimacy of the tax system.

18. • Facilitating compliance
• The first task of any tax administration is to facilitate compliance: ensure that those
who should be in the system are in the system, and that they comply with the rules.
• Enforcing compliance
• To enforce compliance and reduce evasion, the administration needs to understand the
extent and nature of the potential tax base to estimate the tax gap, preferably by sector
and type.
• Improving governance
• The task of the tax administration is not to assess who owes what, but instead to guard
the “borders” of the system and verify that those who should be self-assessing are
behaving responsibly.

19. Reference
• From Billions to Trillions: Transforming Development Finance, WBG
joint with IMF and MDBs, 2015. Pages 7-12
• Domestic Resource Mobilization, USAID, 2015 (read webpage
introduction and 2-page El Salvador case study)
• Financing the future: Why domestic revenue mobilization belongs on
the post-2015 agenda. Devex, 2014 (OpEd, 1 page)
• Smart Tax Administration, WBG, Economic Premise, 2010 (Briefing
Note, 5 pages