More than 100 tax practitioners, researchers and policymakers from across Africa gathered in a conference in Kigali, Rwanda last week to discuss the latest evidence on the potential of, and challenges surrounding the digitalisation of tax administrations.
Co-hosted by the International Centre for Tax and Development (ICTD) and the Rwanda Revenue Authority (RRA), the event – themed ‘Towards a Digital Tax Administration: Lessons learnt and directions for reform’ – featured a selection of panels that tackled in-depth issues critical to the digitalisation agenda. These range from data management and governance to public infrastructure, to inclusion.
“As the global landscape evolves, so must our systems, strategies, and policies,” RRA Commissioner General, Ronald Niwenshuti, noted in his opening remarks.
“Digital transformation is the cornerstone of modern tax administration. It is not merely about technology – it’s about creating systems that foster inclusivity, efficiency, and transparency,” he said.
Progress in digitalisation and tax administrations
Over the last decade, African tax administrations have made significant strides in integrating various digital tools and mechanisms to improve their services. Some successful cases include the use of digital IDs in Burkina Faso to enhance tax collection, as well as the shift towards an E-Tax system in Rwanda that then reduced errors in filing and payments.
ICTD Executive Giulia Mascagni underscored such developments during her intervention, reflecting on the immense progress in the field: “Just 10 years ago, it would have been inconceivable to have a conference like this packed with evidence based on digitised administrative data from African countries.”
Apart from technology adoption, the last decade is likewise marked by collaborations between tax administrations and external researchers in generating much-needed evidence to back tax policies and practice, she added. A prime example of this is the 10 years of partnership between ICTD and the RRA, which has yielded a broad range of research that has gone on to make impact on the ground.
Persisting challenges
Amidst these developments, however, digitalising tax administrations is not without its challenges. Research generated through ICTD’s DIGITAX Programme, for instance, highlights at least three;
- integrating digital tools effectively into core administrative functions,
- building appropriate frameworks and systems for data exchange, and
- expanding access to, and coverage of digital tools.
Antoine Sebera, Government Chief Innovation Officer of the Rwanda Information Society Authority (RISA), for his part, similarly shed light on remaining challenges faced by many African countries in this regard, noting issues of data availability and quality, technological limitations, and lack of infrastructure.
Some of these challenges were tackled during conference panels, which can be rewatched below:
Day 1: Taking stock of current practices and challenges with data and technology
Day 2: Digital Public Infrastructure and pathways for successful digitalisation: where should tax administrations start?
ICTD launches new programme on Digital Public Infrastructure and Tax
While much progress has been made in digital tax administration, there is more work to be done, including in the realm of research. As such, ICTD Research Director Martin Hearson announced the launch of the Centre’s new programme, which will focus on the intersection between Digital Public Infrastructure (DPI) and taxation.
“We used to think of tax administration as primarily a use case for DPI. We know that tax administrations [have] progressed [more in how] they’ve developed digital technology and use of data than many other public institutions. So, there were lessons to be taken from the experiences of tax administrations for other parts of government. Now we think differently because we recognise that tax systems have a role to play in the broader digitalisation of the public realm,” Hearson said.
“Tax administrations can be used as a gateway into digital ID systems, an incentive for the adoption of digital merchant payments, and a catalyst for public sector digitalisation. So that’s an extra responsibility for us as practitioners and researchers in the tax field,” he added.
The new DPI Programme, supported by the Bill and Melinda Gates Foundation, will build on three research questions, namely 1) “How can we strengthen the impact of DPI on tax administrations?”; 2) “How can we strengthen data exchange, in particular, which is the aspect of DPI that’s been least studied in the tax context?”; and 3) “How can we ensure that DPI and tax administration is inclusive and does not reinforce axes of exclusion that we find in tax administration systems and in access to digital services?”.
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