IMF Releases Regional Economic Outlook for Sub-Saharan Africa

generic-coverOn 10 May, the IMF released its Sub-Saharan Africa economic outlook, Restarting the Growth Engine. The report is available (in English and French) on the IMF’s website.

The report features a comprehensive examination of the informal sector in Sub-Saharan Africa, with the IMF estimating that the informal sector contributes 25%-65% of GDP and 30%-90% of nonagricultural employment. From a domestic revenue mobilization perspective, this significant portion of Sub-Saharan African economies represents potential budget revenues. Institutional challenges remain, however, when it comes to encouraging the conversion of the informal sector into the formal sector. A large tax burden and overly cumbersome compliance requirements are likely to have the paradoxical effect of encouraging economic activity to remain in the informal sector. The transformation of digital technologies and services in many Sub-Saharan Africa economies presents opportunities for converting the informal sector, while not creating onerous tax or administrative compliance burdens.

These topics will be further explored as technical sessions in ITIC’s Africa Tax Dialogue later this year, including examination of successful country case studies.


Dan Witt is President of the International Tax and Investment Center (ITIC).

2017 Index of Economic Freedom

Source: 2017 Index of Economic Freedom, Interactive Heat Map (The Heritage Foundation) 

On 15 February, the Heritage Foundation published its annual report entitled, 2017 Index of Economic Freedom, comparing the performance of 186 economies. One key factor influencing the conclusions and rankings is the Tax Burden parameter of the Government Size performance measurement criterion. Continue reading “2017 Index of Economic Freedom”

The Challenges of E-Commerce Regulation for Tax Policy in Africa

The United Nations Commission on International Trade Law (UNCITRAL) defines electronic commerce (e-commerce) as “commercial activities conducted through an exchange of information generated, stored or communicated by electronic optical or analogs means…

With e-commerce now accounting for 80 percent of all global commerce[1], there is an urgent need to regulate these transactions to meet tax policy objectives of broadening the tax base and eliminating erosion. Taxing e-commerce will ensure equal treatment of national production and imports of the same product in order to avoid market distortion. The lack of a standard legal framework can lead to double taxation or double non-taxation; and different regimes for taxation of electronic goods sold electronically and sales of national products in the non-electronic market can distort overall market equity.

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Summary Report – Eighth Africa Tax Dialogue


Hosted by ITIC, in cooperation the Common Market for Eastern and Southern Africa (COMESA) and the Commonwealth Association of Tax Administrators (CATA), over 60 tax officials, leading academic specialists and private-sector representatives from 18 countries convened in Cape Town on 15-17 November 2016 for the Eighth Africa Tax Dialogue to discuss the balance between domestic revenue mobilization and enhancing the investment climate. Continue reading “Summary Report – Eighth Africa Tax Dialogue”

The Basis for the Harmonization of VAT and Excise Taxes in SADC

The Southern African Development Community (SADC) aims to become a Free Trade Area, Customs Union, Common Market, and Monetary Union through the introduction of the single currency, with support for regional integration by Member States utilizing the basic elements of fiscal policy coordination and harmonization.

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