This policy brief reviews the challenges and potential of taxing Africa’s informal economies, drawing on recent research by the African Tax Administration Forum (ATAF) and the International Centre for Tax and Development (ICTD). It finds that many currently used strategies place disproportionate burdens on low-income operators, yield limited revenue, and risk weakening taxpayer trust in revenue authorities. The paper advocates for a more evidence-driven and targeted engagement with informal economies.
Key recommendations include focusing tax efforts on higher-income earners within informal economies, developing sector-specific tax strategies, improving coordination between state agencies, prioritising poverty-sensitive policies, and engaging informal sector representatives to foster trust. It highlights the importance of research in partnership with revenue authorities in order to design and evaluate effective and inclusive policies on taxing informal economies.
Dr Ezera Madzivanyika is Manager: Research & Statistics at the African Tax Administration Forum (ATAF), where he leads applied research and statistical analysis to support tax policy and domestic revenue mobilisation across Africa. An economist and IMF-certified TADAT Assessor with more than 25 years of experience, he previously served in senior technical roles at the Zimbabwe Revenue Authority (ZIMRA). His work has shaped continental research on tax expenditures, high-net-worth individuals, international taxation, the digital economy, environmental taxation, and OECD-led tax reforms. Dr Madzivanyika holds a PhD in Economics, an MPhil in Taxation, and has published extensively on taxation and public finance.
Ronald Waiswa is an Applied Research and Statistics Specialist at the African Tax Administration Forum (ATAF). Previously, he was a Research and Policy Analysis Supervisor at the Uganda Revenue Authority. He has collaborated with ICTD on a number of research projects in Uganda on issues including taxing wealthy individuals and public sector agencies.
Max Gallien is Research Director of ICTD. His research specialises in the politics of informal and illegal economies, the political economy of the Middle East and North Africa and development politics. He completed his PhD at the London School of Economics. Max co-leads the informality and taxation programme with Vanessa, as well as the ICTD’s capacity building programme.
Vanessa van den Boogaard is a Senior Research Fellow at ICTD and a Senior Research Associate at the Munk School of Global Affairs and Public Policy at the University of Toronto. She completed her PhD thesis on informal revenue generation and statebuilding in Sierra Leone, and has ongoing research on the topic in the Democratic Republic of the Congo, Ghana, and Somalia. Vanessa co-leads ICTD's research programmes on informality and gender and tax.
Mary Abounabhan is a Researcher working on ICTD's Digital Public Infrastructure (DPI) research theme. She is also underaking a PhD in practice. Her research focuses on the the appropriateness and effectiveness of digital financial services taxes and their development impacts. She has completed her Masters of Globalisation, Business, and Development at the Institute of Development Studies, focusing her research on the Moral Economy of social media taxation in Lebanon.
