Revenue Statistics in Africa: First edition

Revenue Statistics in Africa: First edition

REVENUE STATISTICS IN AFRICAOFFICIAL LAUNCH OF THE 1ST EDITIONSébastien Markley and Emmanuelle Modica

A partnership

Cameroon Cote d’Ivoire Mauritius Morocco

Rwanda Senegal South Africa Tunisia

Eight participating countries

A partnership between the African Union Commission, ATAF and OECD

Technical support from AfDB, WCO and CREDAF

Revenue Statistics in Africa: A global project

…for global and African agendas

Sustainable Development Goals’ targets

the Strategy for the Harmonisation of Statistics in Africa.

the African Union’s Agenda 2063

A tool for tax policy analysis Guaranteed comparability between countries,

with Latin America, OECD Based on a well-established OECD classification

A new, free dataset on revenue

Both tax and non-tax revenue

Tax-GDP ratios, tax structure and share of tax revenues by levels of government.

Evolution of key indicators since 1990

A new set of key indicators

Total tax revenues as % of GDP since 2000

A detailed and visual analysis

Description of the key tax and tax administrations reforms

Annual and bilingual

A new publication

Revenue Statistics in Africa:Definitions

• Tax revenues are

compulsory unrequited payments to the general government

• Non-tax revenues refer to all revenues paid to general government that are not defined as taxes

Revenue Statistics in Africa: Definition of tax revenue

“Tax revenues are compulsory, unrequited payments to the general government”

Taxes on income, profits and gains Social security contributions Taxes on payroll and workforce Taxes on property Taxes on goods and services Other tax revenues

Revenue Statistics in Africa : Results

I. Tax revenue trends 2000-2014

II. Tax structure

III. Non–tax revenue

IV. Future steps and conclusions

Total taxes as a % of GDP, 2014

0%

5%

10%

15%

20%

25%

30%

35%

40%

34.4%

21.7%

31.3%28.5% 27.8%

20.1% 20.0%17.8%

16.1% 16.1%

There is less disparity in total taxes on goods and services…

OECD (201

3)

LAC av

erage

Tunis

ia

Moroc

co

Sout

h Afri

ca

Sene

gal

Maurit

ius

Côte d'

Ivoire

Camero

on

Rwanda

0%

5%

10%

15%

20%

25%

30%

35%

40%

11.0% 10.6% 11.3% 11.9% 11.4% 13.1% 12.9%10.9% 9.6% 9.0%

34.1%

21.7%

31.3%28.5% 27.8%

20.1% 20.0%17.8% 16.1% 16.1%

Taxes on goods and services, 2014

… than there is for taxes on income

OECD (201

3)

LAC av

erage

Tunis

ia

Moroc

co

Sout

h Afri

ca

Sene

gal

Maurit

ius

Côte d'

Ivoire

Camer

oon

Rwanda

0%

5%

10%

15%

20%

25%

30%

35%

40%

11.5%

6.1%9.9% 8.3%

14.3%

5.1% 4.8% 4.2% 4.9% 6.0%

34.1%

21.7%

31.3%28.5% 27.8%

20.1% 20.0%17.8% 16.1% 16.1%

Taxes on income, profits and capital gains, 2014

Personal income tax is not an important source of revenue in most African countries

OECD (...

Tunis

ia

Moroc

co

Sout

h A...

Sene

gal

Mauri.

..

Came..

.

Rwanda

0%

5%

10%

15%

20%

25%

30%

35%

40%

8.8%5.1% 3.7%

8.9%

3.1% 1.8% 1.1%3.6%

34.1%31.3%

28.5% 27.8%

20.1% 20.0%16.1% 16.1%

Taxes on personal income, 2014

Corporate IncomeTax levels vary by country

0%

5%

10%

15%

20%

25%

30%

35%

40%

2.9%4.8% 4.5% 4.8%

1.7% 2.7% 2.9% 2.4%

34.1%31.3%

28.5% 27.8%

20.1% 20.0%16.1% 16.1%

Taxes on corporate income, 2014

Social security was a major component of taxes in Tunisia and Morocco, but far less in other African countries

OECD (201

3)

LAC av

erage

Tunis

ia

Moroc

co

Sout

h Afri

ca

Sene

gal

Maurit

ius

Côte d'

Ivoire

Camero

on

Rwanda

0%

5%

10%

15%

20%

25%

30%

35%

40%

9.1%

3.7%

8.6%5.9%

0.4% 1.0% 1.0% 2.0% 0.9% 1.0%

34.1%

21.7%

31.3%28.5% 27.8%

20.1% 20.0%17.8% 16.1% 16.1%

Social security contributions, 2014

Countries with higher GDP per capita tend to have higher tax to GDP ratios

3.0

1.7

3.1

18.6

2.3

7.6 11.3 13.0

Africa OECD LAC

Tax to GDP ratio-------------->

GD

P pe

r ca

pita

in P

PP d

olla

rs---

------

------

->

There are many possible factors influencing tax to GDP ratios

Size of agricultural sector

Country is “resource-rich”

Openness to trade Size of informal economy Power of tax

administrations Level of corruption Tax morale Geographic location Historic factors

Rwanda

Côte d'

Ivoire

Camer

oon

Moroc

co

Seneg

al

Tunisi

a

LAC ave..

.

Maurit

ius

South

Africa

OECD ave..

.0%

5%

10%

15%

20%

25%

30%

35%

40%

Agriculture as % of GDP vs tax to GDP ratios, 2014

Tax to GDP ratios in African countries in the report have been rising since 2000

Total tax revenues as % of GDP

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20140%

5%

10%

15%

20%

25%

30%

35%

40%

Cameroon, Côte d’Ivoire, Mauritius, Rwanda, Senegal

Morocco, South Africa, Tunisia

OECD Average

LAC Average

… but this trend was disrupted by the global financial crisis of 2007/08: countries were affected differently

Change in tax-to-GDP ratios from 2008 levels, in percentage points, 2007-2014

OECD Average Morocco Côte d'Ivoire South Africa Mauritius-4

-3

-2

-1

0

1

2

LAC Average Tunisia Rwanda Cameroon Senegal-2

-1

0

1

2

3

Every country saw a rise in tax to GDP ratio

Change in tax to GDP ratios between 2000 and 2014

(Percentage points of GDP)

0.20.8

2.43.3 3.3

4.7 4.95.5 5.9

6.7

Tax to GDP ratios increase between 2000 and 2014 was driven by income taxes

Tax revenue growth between 2000 and 2014(Percentage points of GDP)

OECD*

Mauritius

Côte d'Ivoire

Cameroon

Senegal

LAC

Morocco

South Afri

ca

Rwanda

Tunisia

-6.0

-4.0

-2.0

0.0

2.0

4.0

6.0

8.0

10.0

-0.10.8

2.43.3 3.3

4.6 4.95.5 5.9

6.7

Taxes on income and profits (1000) Total

*2013 data

… and also driven by taxes on general consumption (i.e. VAT)


OECD*

Mauritius

Côte d'Ivoire

Cameroon

Senegal

LAC

Morocco

South Afri

ca

Rwanda

Tunisia

-6.0

-4.0

-2.0

0.0

2.0

4.0

6.0

8.0

10.0

-0.10.8

2.43.3 3.3

4.6 4.95.5 5.9

6.7

Taxes on income and profits (1000) Taxes on general consumption (5110) Total

*2013 data

…whereas taxes on specific consumption (excises and import duties) showed important decreases or small increases


OECD*

Mauritius

Côte d'Ivoire

Cameroon

Senegal

LAC

Morocco

South Afri

ca

Rwanda

Tunisia

-6.0

-4.0

-2.0

0.0

2.0

4.0

6.0

8.0

10.0

-0.10.8

2.43.3 3.3

4.6 4.95.5 5.9

6.7

Taxes on specific consumption (5120) Taxes on income and profits (1000)

Taxes on general consumption (5110) Total

*2013 data

Tax to GDP ratios increase between 2000 and 2014 was driven by income taxes and taxes on general consumption (i.e. VAT)


OECD*

Mauritius

Côte d'Ivoire

Cameroon

Senegal

LAC

Morocco

South Afri

ca

Rwanda

Tunisia

-6.0

-4.0

-2.0

0.0

2.0

4.0

6.0

8.0

10.0

-0.10.8

2.43.3 3.3

4.6 4.95.5 5.9

6.7

Taxes on specific consumption (5120) Taxes on property (4000)Taxes on income and profits (1000) Social security contributions (2000)Taxes on general consumption (5110) Total

*2013 data

Revenue Statistics in Africa: Results


II. Tax structure

III. Non–tax revenue


Tax structures vary between African countries, but the dominant form of taxation is consumption tax (goods and services)

OECD (2013)Tunisia

SenegalMorocco

Côte d'Ivoire

Breakdown of tax revenue in 2014 by category of taxes

1000 Income and profits3000 Payroll taxes4000 Property taxes5000 Goods and services taxes6000 Other taxes2000 Social security

South Africa is the only country in the publication to collect mostly income taxes

Income and prof -its; 51%

Social security; 1%

Payroll taxes; 1%

Property taxes; 5%

Goods and services

taxes; 41%

South Africa

Five of the eight countries in the report reported most of their income from taxes on goods and services

SenegalRwanda

MauritiusCôte d'IvoireCameroon

Income and profitsSocial securityPayroll taxesProperty taxesGoods & services taxesOther taxes

Tunisia and Morocco have tax structures more resembling the average OECD

OECD (2013)Tunisia Morocco

Income and profitsSocial securityPayroll taxesProperty taxesGoods & services taxesOther taxes

Corporate income tax is an important source of revenue in most African countries

0%2%4%6%8%

10%12%14%16%18%20%

8.5%

16.6%15.3%

17.2%15.8%

8.6%

15.0%13.3%

18.1%

Taxes on corporate income as % total tax, 2014

Since the 2000s, taxes on income and profits have increased as a percent of total taxation, except notably in South Africa…

Taxes on income and profits by country as a percent of total taxation

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

0%

10%

20%

30%

40%

50%

60%

70%

South Africa

Cameroon, Cote d’Ivoire, Mauritius, Morocco, Rwanda, Senegal Tunisia

LAC Average

OECD Average

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

0%

10%

20%

30%

40%

50%

60%

70%

80%

…while taxes on goods and services have generally decreased.

Tax on goods and services by country as a percent of total taxation

OECD Average

LAC Average

Cameroon, Cote d’Ivoire, Mauritius, Morocco, Rwanda, Senegal Tunisia, South Africa

Levels of government

1. Total revenues

2. Central government revenues

3. Regional (provincial) government revenues

4. Local government revenues

5. Social security funds

Tax revenues from subnational levels remain low and property taxes form the main source of revenue

Mauritius Morocco South Africa0.5%

2.3%

3.9%

1.1%

3.1%

4.8%Subnational taxes as a percentage of total taxes

Subnational property taxation as a percent of all taxes is the area in purple



II. Tax structure

III.Non–tax revenue


Non-tax revenue

“Non-tax revenues refer to all revenues paid to general government that are not defined as taxes”

Grants (i.e. foreign aid) Property income

Rents (e.g. resource royalties) Interest and dividends (e.g. investment income)

Sales of goods and services (incl administrative fees)

Fines and penalties Other non-tax revenues

NB: This does not include funds raised from privatisation

Grants

Grants are voluntary payments from foreign governments and international organisations. They are essentially foreign aid. • Ex: Heavily Indebted Poor Countries (HIPC)

initiative

Property income

Property income: revenue government gets through ownership of property.

• Rents: revenue from land ownership. Payments government obtains in exchange for access to its lands or for extracting resources.

• Mineral royalties (oil, gold)

• Rents from farming/logging on public land (cocao, timber royalties)

Property income

Property income: revenue government gets through ownership of property.

• Interest and Dividends: for example revenue from government investment in private businesses (e.g. PPPs, stock portfolios, sovereign wealth funds, etc.)

Sales of goods and services

Goods or services sold by government are considered non-tax revenues since sales are payments in proportion to value of good or service received. • Non-market : admission fees to museums, hospital admission

fees, etc

• Market: Government cafeterias, sale of sand, publications

• Leasing of buildings and equipment: Wedding venues, vehicle rentals

• Administrative fees

Administrative fees

• Administrative fees occupy a grey area between sales of goods and services and taxes.

• Classified on a case-by-case basis.

• Administrative fees are considered taxes when:

• payment greatly exceeds cost of providing service

• person paying fees is not person receiving benefit

• benefits of service are not in proportion to fee payments

Administrative fees

Sales of goods and services

Taxes

• court fees• driving licence fees• harbour fees• passport fees• radio and television

licence fees

• Film distribution permits

• hunting and fishing licenses

• gambling licenses• permission to sell

alcohol or tobacco• permission to own dogs• motor vehicle

registration fees• gun permits• severance taxes

The countries with higher GDP per capita tend to have lower ratios of non-tax revenue to GDP ratios

Rwanda

Sene

gal

Camero

on

Côte d'

Ivoire

Moroc

co

Tunis

ia

Sout

h Afri

ca

Maurit

ius

16%

20%

16%18%

29%31%

28%

20%

10%

6%4%

2%3%

2%1%

2%

Revenue as a percent of GDP,2014Tax revenueNon-tax revenue

Different countries rely on different kinds of non-tax revenue

Rwanda

Seneg

al

Camer

oon

Côte d'

Ivoire

Moroc

co

Tunisi

a

South

Afri

ca

Maurit

ius0%

10%20%30%40%50%60%70%80%90%

100%

Total non-tax revenues as a percent of total non-tax revenue, 2014

Grants RentsOther non-tax revenue

Mainly fines,

penalties and

forfeits

Mainly interest

and dividends

Mainly sales of goods and

services, admin

fees

Mainly income

from quasi-

corporations,

sales of goods and

services

These can take the form of grants (or foreign aid)…

Rwanda

Sene

gal

Camer

oon

Côte d'

Ivoire

Moroc

co

Tunis

ia

Sout

h Afri

ca

Maurit

ius0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

7.8%

3.3%

0.2%

1.8%

0.0%0.5%

0.1% 0.1%

9.5%

5.7%

4.2%

2.2%

3.5%

2.2%

0.6%

2.4%

Grants by country as % GDP, 2014

…or rents (essentially mineral royalties)…

Rwanda

Sene

gal

Camer

oon

Côte d'

Ivoire

Moroc

co

Tunis

ia

Sout

h Afri

ca

Maurit

ius0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

0.0% 0.3%

3.6%

0.1% 0.5% 0.4%0.1% 0.3%

9.5%

5.7%

4.2%

2.2%

3.5%

2.2%

0.6%

2.4%

Rents as % of GDP by country, 2014

…or other non-tax revenue.(investment income, sales of goods and services, fines and forfeits, etc.)

Rwanda

Sene

gal

Camer

oon

Côte d'

Ivoire

Moroc

co

Tunis

ia

Sout

h Afri

ca

Maurit

ius0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10% 9.5%

5.7%

4.2%

2.2%

3.5%

2.2%

0.6%

2.4%1.7% 2.1%

0.5% 0.3%

3.0%

1.3%

0.4%

2.1%

Other non-tax revenue as % of GDP by country, 2014

Mainly fines,

penalties and

forfeits

Mainly sales of goods and

services, admin

fees

Mainly income

from quasi-

corporations,

sales of goods and

services

Not categori

zed

Mainly interest and dividends, fines and penalties

Rwanda’s non-tax revenue (mostly grants) is highly variable.

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20140.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

Grants and total non-tax revenues as % GDP, Rwanda

Total non-tax revenue Grants

% o

f G

DP

Cameroon’s non-tax revenue is mostly royalties and is also highly variable

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20140.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

10.0%

Rents (royalties) and total non-tax revenues as % of GDP, Cameroon

Total non-tax revenues Rents

% o

f G

DP



II. Tax structure

III.Non–tax revenue

IV. Next steps and conclusions

• Second edition in 2017.

• Include more countries in Africa.

• Streamline data collection gathering and processing

• Coverage of Local government, Social security funds

• Further technical discussions and training with existing and new participating countries.

• Workshop – lessons learned from first edition, bring new participants up to speed.

Next steps

• Access to core requirement to inform tax policy: centralised & exhaustive data for Africa and other continents.

• Benchmark against countries within the continent and outside for any type of taxes.

• Understand in details the categories of taxes to tap in to raise more revenues.

• Enter policy dialogue with countries and partners and access to tax advice on a comparable basis.

What would I get from this initiative?

• Capacity building by seconding tax experts at the OECD

• Acquisition of new techniques being developed at the international level

• Improvement of national data

• Transparency leading to improvement of trust from citizens

What would I get from this initiative?

OECD Centre for Tax Policy and Administration, the OECD Development Centre

• Michelle Harding [email protected]• Maurice Nettley [email protected]• Emmanuelle Modica [email protected]

OECD Development Centre

• Henri-Bernard Solignac-Lecomte ([email protected])• Sebastien Markley Sebastien. [email protected]

Contacts

mailto:[email protected]





Revenue Statistics in Africa: First edition

Economy & Finance

Transcript of Revenue Statistics in Africa: First edition