The African Tax Administration Forum (ATAF) has created a multilateral treaty for the exchange of information to enable African countries exchange skilled staff and information in efforts to narrow tax collection losses from multinational companies.
“After countries ratify the multilateral treaty for the exchange of information, there will be a legal basis to share information and staff,” said Logan Wort, the ATAF head.
“The African continent has lost over $10 trillion over the last decade to tax fraud, and evasion. If we can build efficient revenue management systems and increase collections by 10%, we will cut aid by 50%,” he added.
Wort made the comments during a Thomson Reuters Foundation training in Hatfield, South Africa.
He noted that the telecoms and e-commerce sectors have recorded tremendous growth in the continent. However, tax administration systems and laws are yet to catch up with the sectors.
Wort noted that ministers should only grant tax incentives to foreign investors after consulting with relevant government structures and technocrats to avoid creating huge tax collection gaps.
“The tax incentives to oil, gas and gold companies should be renegotiated after threeyears since the deal may disproportionately favor the company and not the country,” Wort said.