Addis Ababa, Ethiopia – The President of the Republic of Ghana, H.E. John Dramani Mahama, has emphasized that combating illicit financial flows and strengthening tax compliance are crucial for boosting revenue in African countries.
Speaking at the Heads of State and Government Breakfast Dialogue at the African Union Commission headquarters in Addis Ababa, Ethiopia, President Mahama, who serves as the Champion on African Union Financial Institutions, stressed the importance of domestic resource mobilization in addressing Africa’s financing gap.
“Your Excellencies, addressing the financing gap requires a multifaceted approach. Domestic resource mobilization is crucial,” he stated.
He urged African leaders to foster a culture of tax compliance to enhance revenue generation.
“By improving tax administration and combating illicit financial flows and encouraging a culture of tax compliance, we can significantly increase our revenues,” he noted.
President Mahama commended the African Union Commission for its proactive role in building capacity among member states and advocating for fair international tax rules.
“We applaud the African Union Commission for its proactive role in providing capacity building to member states at a continental level and advocating for fair and equitable international tax rules at a global level,” he told the gathered dignitaries.
He also highlighted the importance of the United Nations Framework Convention on International Tax Cooperation, describing it as a key initiative in preventing profit shifting and protecting national revenues.
“The ongoing work on the United Nations Framework Convention on International Tax Cooperation is a critical step towards eliminating base erosion and profit shifting, thus protecting our national revenues,” he said.
However, he cautioned that domestic efforts alone would not be sufficient. African countries must significantly increase their tax-to-GDP ratios to bridge the financing gap by 2030.
“However, domestic efforts alone will not suffice. It is projected that African countries need to increase their median tax-to-GDP ratios by about 13.2 percentage points to 27.2% of GDP to be able to close the financing gap by 2030,” he stated.
He concluded by calling for innovative financial resources and global financial architecture reforms to ensure fair and inclusive distribution of resources.
“This highlights the need for additional innovative financial resources and reform of the global financial architecture to ensure equitable and inclusive distribution of resources,” he emphasized.
Story by: Emmanuel Romeo Tetteh (#RomeoWrites
) / Ahotoronline.com | Ghana 
