How African Countries can smoothen tax collection

African countries are currently facing a critical juncture, with at least 22 nations on the brink of debt distress due to dwindling revenue mobilization. To address this pressing issue, CNBC Africa's Aby Agina recently sat down with Dr. Fred Mugambi Mwirigi, the Vice Chair of the African Tax Research Network, to discuss strategies that countries can utilize to boost tax collection and reduce illicit financial flows. The African Tax Research Network serves as the research arm of the African Tax Administration Forum and aims to address various challenges in the tax space, including taxation of the digital economy, tax base expansion, and optimization of tax systems and processes. The recent ATRN Congress brought together researchers from across Africa to delve into these issues and explore new areas of taxation to increase revenue. Dr. Mugambi highlighted the significance of optimizing tax revenues, especially in light of ballooning government expenditures driven by public debt. He emphasized the need to tap into new tax areas, such as environmental tax and informal economy taxation, to bridge the gap between GDP contributions and tax revenues. The Congress also shed light on the importance of capacity building for tax administrators and the general population to combat illicit financial flows and enhance tax compliance. Looking ahead, Dr. Mugambi emphasized the pivotal role of technology, including artificial intelligence, in predicting tax patterns and minimizing tax leakages. Additionally, he underscored the importance of holistic approaches that consider policies, laws, and formalization of the economy to maximize tax revenue mobilization. By the end of the Congress, it is expected that solid research papers and policy recommendations will be presented to support various African countries in bolstering their tax collection efforts.