Policy Brief - Sub-Saharan Africa (SSA) Needs to Collect More Taxes and Spend Better

download here

pdf (1MB)

Download

Policy Brief - Sub-Saharan Africa (SSA) Needs to Collect More Taxes and Spend Better

July 8, 2024

SSA's public debt remains high at 60 percent of its Gross Domestic Product (GDP) in 2023, with many countries facing a funding squeeze due to limited sources of revenue and high borrowing costs. Government interest payments now consume 12 percent of revenues, more than double the level from a decade ago, while official development assistance has decreased. This diverts funds from investment and development, hindering growth and building resilience to shocks. SSA countries should broaden their respective tax bases, improve tax progressivity, strengthen taxation of the wealthy and enhance tax administration. Improving the effectiveness and efficiency of expenditure requires better governance, e-procurement, addressing wage rigidities, and using digital tools. Strengthening medium-term planning, regular expenditure reviews, and promoting public-private partnerships are also essential. These combined strategies are crucial for rebuilding fiscal buffers, preparing for future shocks, and achieving sustainable development. sustainable development.

Document Type
Regions and Countries
Sustainable Development Goals