The IMF’s Fiscal Affairs Department (FAD), in coordination with the Institute for Capacity Development (ICD) and the AFRITAC West 2 Regional Technical Assistance Center, sponsored an international conference June 28-30, 2016, in Accra, Ghana.

The event brought together representatives from sixteen beneficiary countries, Trust Fund partners -the European Union (EU), Germany, Switzerland, and the Netherlands), and another development partner –Canada.

The conference discussed countries’ experiences in designing and managing tax administration reform programs in the beneficiary countries of the Tax Policy and Administration Topical Trust Fund (TPA-TTF).

The conference took place in the context of heightened international recognition of the importance of mobilizing domestic resources in developing countries, as reflected in the Addis Tax Initiative and the U.N.’s Sustainable Development Goals (SDGs). It also marked the culmination of five years of experience under the TPA-TTF with tax administration reforms in approximately twenty low and lower-middle income countries in three regions: Asia, Latin America and Sub-Saharan Africa.

Mr. Seth Terkper, Minister of Finance of Ghana, opened the conference by highlighting the main legislative and administrative initiatives that the government of Ghana has taken in recent years to modernize the structure of the tax system and its administration, as well as the important role of the TPA-TTF and FAD in supporting these initiatives through technical assistance.

The conference offered an opportunity to take stock of the elements required for tax administration reforms to succeed, including: strong leadership from the senior-most levels of government; a proper diagnostic that recognizes institutional realities on the ground and helps establish a consensus regarding the need for reform; a well-articulated reform strategy that is appropriate for the country’s context, has clear priorities and realistic goals, and is properly resourced; a reform management team whose focus is on implementing and monitoring the various reform projects; and a system to monitor and evaluate results.

Key challenges identified by country officials included: incorporating the formal sector into the tax net; including civil society into the reform process; overcoming internal and external resistance to change at the beginning and during the reform process; addressing corrupt practices; and assessing a country’s tax collection potential.

The conference closed with a round-table discussion of the next phase of the TPA-TTF, the Revenue Mobilization Trust Fund, which will start operating in 2017. During the final discussion, partners, represented by Mr. Wiebe Anima, a member of the TPA-TTF Steering Committee, emphasized their support for the work of the IMF and the importance of continuing to strengthen countries’ capacity to mobilize additional domestic revenues.

Background

The Tax Policy and Administration Topical Trust Fund (TPA-TTF), launched in 2011, had the objective of helping low-income and lower middle-income countries establish well-designed and administered tax systems that generate sustainable revenue to pay for essential public services. In partnership with Belgium, the EC, Germany, the Republic of Korea, Kuwait, Luxembourg, the Netherlands, Norway, and Switzerland, the IMF has met increasing demand from beneficiary countries and currently supports 20 programs, the majority in Sub-Saharan Africa. Phase 2 of the trust fund was recently launched as the Revenue Mobilization Trust Fund.

Global thematic funds support the IMF’s capacity development activities (technical assistance and training) in specialized thematic areas that complement the work of the IMF’s regional technical assistance and training centers.

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