Recognising that global governance is rapidly shifting into the digital realm, the 2025 G20 Leaders’ Declaration commits to safe, trustworthy AI, stronger cross-border digital payments, and inclusive data governance – developments with major implications for Africa’s fiscal sustainability and digital public infrastructure (DPI). For African countries confronting tightening fiscal space and rising debt-service costs, this digital agenda is not simply technological — it is fiscal. It shapes how states identify taxpayers, track transactions, detect evasion, and deliver services that build trust and support domestic resource mobilisation.
For the first time in its history, the G20 Presidency was held on African soil. Under the banner “Solidarity, Equality, Sustainability”, South Africa’s 2025 Presidency placed digital transformation, fiscal resilience, and inclusive development at the centre of the global agenda. The T20 Summit in Johannesburg (13–14 November 2025) unfolded within this context, convening experts, policymakers, and researchers to reflect on the global governance challenges that will shape tax reform and digital transformation across the continent.
Why the T20 tax agenda matters for Africa
Across the panels, one message stood out: Africa is confronting an intensifying fiscal crisis. Rising debt-service costs, shrinking concessional finance, and widening inequality raise urgent questions about how governments can sustainably fund development. These concerns mirror the priorities of the G20 Presidency, which emphasises the need to “build fiscal buffers and ensure fiscal sustainability” to support long-term development. As underscored by the T20 plenary on “Debt, the Cost of Capital and IFFs”, many African countries now devote more resources to debt repayments than to critical sectors such as health, education, or public investment. In this environment, taxation emerges as the most sustainable anchor of fiscal sovereignty — yet its performance is hampered by limited administrative capacity, weak data systems, and persistent trust deficits.
South Africa’s focus on AI, data governance, DPI aligns closely with the T20 digital transformation agenda, suggesting a shared recognition that the next wave of state capacity will be digital. Within this context, the T20 discussions illustrate how DPI, digital money, and inclusive digital governance can serve not merely as service-delivery tools but as new foundations for fiscal capacity and revenue mobilisation.
Unlocking development through digital public infrastructure: Implications for tax
The T20 panel on “Unlocking Development through Digital Public Infrastructure: e-Governance, Data Governance, AI and Digital Sovereignty” examined how emerging digital ecosystems can transform state capability and inclusive development. The core argument was clear: DPI is not simply a technological choice — it is state-building infrastructure. As recognised by the G20 Indian presidency, DPI has become “a pivotal instrument for inclusive and sustainable development”. Panellists defined DPI as the digital equivalent of public utilities: integrated, open systems combining digital identity, instant payments, and secure data exchange, on top of which governments and private actors build services.
The G20 Leaders’ Declaration reinforces this framing, recognising “the transformative potential of digital public infrastructure to advance equitable, inclusive, prosperous, resilient and sustainable digital transformation” and calling for digital ecosystems grounded in safety, resilience, and trust. This confirms that DPI is not a peripheral – it is a central pillar of state capability and inclusive governance.
For African countries, the implications for tax collection and administration are significant:
- Digital ID strengthens taxpayer identification and reduces duplication.
- Interoperable payments improve traceability of transactions and reduce revenue leakages.
- Data exchange layers enable tax administrations to match information across agencies and better detect evasion.
- Digitised public services increase trust, a key determinant of voluntary compliance.
Evidence from the ICTD’s Digital Public Infrastructure and Tax programme shows how foundational digital systems can strengthen tax capacity across African countries. Studies on Ghana’s integration of digital IDs and Burkina Faso’s rollout of e-tax services demonstrate that combining taxpayer identification, interoperable payments, and e-services expands registration, improves compliance, and enhances perceptions of fairness. Together, these findings illustrate that DPI is not an abstract reform but a practical pathway for widening the tax base and improving voluntary compliance.
Digital public infrastructure without good governance can’t deliver fiscal development
However, the panel also stressed that DPI becomes transformative only with deliberate governance. South Africa’s proposed “integrated governance of DPI guidelines” — aligning digital infrastructure with constitutional rights, data-protection laws, and mechanisms for accountability — underscore the importance of embedding privacy, fairness, and citizen trust in DPI design. Without such safeguards, DPI can deepen exclusion, particularly where millions still lack legal documentation, reliable connectivity, or digital skills.
The T20 panel on “Future Directions for Equitable and Inclusive Digital Transformation” reinforced this fiscal perspective. Panellists noted that digital systems cannot deliver development outcomes or revenue gains unless they are genuinely inclusive. Today’s digital divide is shaped less by connectivity gaps and more by affordability constraints, low digital skills, linguistic barriers, and the absence of foundational documentation — all of which translate into fiscal exclusion. The populations unable to access digital IDs, payment platforms, or e-government portals are the same citizens and firms who remain outside the tax net. Ensuring that DPI is accessible, affordable, and anchored in rights is therefore not only a development imperative — it is a fiscal one.
Hence, DPI is no longer viewed as a technical add-on but as a structural governance priority — one that could directly strengthen African tax administrations if systems are interoperable, accessible, and rights-preserving.
Digital money and the future of fiscal capacity: What the G20 next financial frontier means for taxation in Africa
The panel on “Digital Money: The G20’s Next Financial Frontier” made clear that the evolution of digital currencies is not only a financial challenge — it is a fiscal one. Whether through mobile money, instant payments, stablecoins, or emerging Central Bank Digital Currencies (CBDCs), digital money is reshaping how economic activity is recorded, monitored, and taxed.
For African countries, the most immediate opportunity lies in the greater visibility created by digital transactions. As merchant payments, peer-to-peer transfers, and business operations move into digital channels, they leave auditable trails that tax administrations can use to identify income, expand the tax base, and reduce reliance on discretionary enforcement. Real-time payments data also improves the ability to detect illicit financial flows and track sectors that have historically remained informal. These developments align closely with ongoing efforts to strengthen domestic resource mobilisation.
Yet the session also highlighted that digital money introduces new risks for fiscal governance. Cryptocurrencies and unregulated digital assets complicate tax enforcement, enabling cross-border movements of wealth that escape visibility. More importantly, the growing use of foreign-currency stablecoins — often seen as a hedge against inflation — can erode monetary sovereignty. When large parts of the economy transact in privately issued or foreign-backed digital money, governments lose control over both monetary policy and the informational foundations of taxation.
The panel underscored that the path forward hinges on governance and coordination. Digital money can strengthen fiscal capacity, but only if regulatory frameworks are harmonised, financial stability risks are addressed, and countries retain sovereign control over their digital financial infrastructure. For Africa, this means avoiding technological dependency, ensuring that digital payments systems remain interoperable and inclusive, and building regulatory approaches that protect both monetary stability and the fiscal state.
Ultimately, the digitalisation of money is a fiscal opportunity — but without governance, it becomes a fiscal threat.
The G20 digital transformation and Africa’s fiscal future
The discussions at the T20 Summit made clear that Africa’s fiscal future cannot be separated from its digital future. Whether through DPI that strengthens administrative capacity or digital money that reshapes financial ecosystems, the G20 digital agenda creates new opportunities for modernising tax systems— but only if governance, inclusion, and sovereignty remain central.
These opportunities will not materialise automatically. They require sustained analysis, cross-country learning, and a stronger space for African tax perspectives within the G20/T20 process. As African countries confront rising debt burdens and shrinking fiscal space, coordinated engagement on tax policy and digital governance becomes essential. Future G20 presidencies should therefore prioritise supporting African states to harness digital transformation in ways that strengthen tax collection capacity and build long-term fiscal sovereignty.
Disclaimer: The views expressed in this opinion piece are those of the author/s and do not necessarily reflect the views or policies of ICTD or those of our funders.
