Africa is accelerating the modernization of its tax administrations to strengthen domestic resource mobilization, which is now recognized as a key driver for financing industrialization, infrastructure, and the continent’s economic transformation. This is one of the main conclusions of the “Tax Transparency in Africa 2026” report, jointly published by the OECD Global Forum on Transparency and Exchange of Information for Tax Purposes and the African Tax Administration Forum (ATAF).

The report shows that the Africa Initiative now brings together 39 African member countries and 19 technical and financial partners, making it one of the continent’s largest tax cooperation platforms. Its objective is to improve tax transparency, combat tax fraud and tax evasion, strengthen the capacity of tax administrations, and sustainably increase public revenues to support economic development.

Significant progress has already been achieved. More than 40 African countries now participate in international tax transparency standards and are progressively implementing systems for the automatic exchange of information or the exchange of information on request with international partners. This cooperation enables tax authorities to identify offshore assets more effectively, combat income concealment, and improve tax collection.

According to the report, international tax information exchanges have already enabled several African tax administrations to recover tax revenues that had previously been lost, while also strengthening investor confidence in public governance. The digitalization of tax filing, the expansion of electronic tax platforms, the interconnection of government databases, and the use of risk analysis tools have further improved the efficiency of tax audits while reducing collection costs.

Domestic Resources at the Heart of Africa’s Industrialization

Mobilizing domestic tax revenues has become one of Africa’s most critical development priorities. According to the African Development Bank (AfDB), the continent faces an annual infrastructure financing gap of between US$130 billion and US$170 billion, while investment needs in energy, transport, water, digital infrastructure, and industry continue to grow. Strengthening domestic revenue collection has therefore become essential to narrowing this financing gap.

Africa remains the region with the world’s lowest average tax-to-GDP ratio, estimated at around 16%, compared with approximately 34% in OECD member countries. This gap represents enormous untapped financing potential for public investment. According to several international institutions, increasing the tax-to-GDP ratio by just one percentage point could generate billions of additional dollars in public revenue every year for African governments.

Tax transparency is also a powerful tool for combating illicit financial flows, which the United Nations Economic Commission for Africa (UNECA) and the African Union estimate at approximately US$88.6 billion annually, equivalent to nearly 3.7% of Africa’s GDP. These losses significantly reduce governments’ ability to finance infrastructure, public services, and industrial investment.

African tax administrations are increasingly investing in digital tax services, artificial intelligence, data analytics, and the training of tax officials to improve fraud detection, broaden the tax base, and simplify compliance procedures for taxpayers. Several countries have already introduced electronic tax filing, e-invoicing, and digital payment systems.

Modern Tax Systems to Enhance Africa’s Competitiveness

Improving tax governance has become a decisive factor in Africa’s economic attractiveness. International investors increasingly value stable tax regulations, transparent tax administrations, and strong legal certainty. Modern tax systems reduce investment risks, improve predictability, and strengthen business confidence.

These reforms also support the ambitions of the African Continental Free Trade Area (AfCFTA), which brings together 54 countries, more than 1.4 billion people, and a combined GDP exceeding US$3.4 trillion. The development of regional industrial value chains requires efficient tax administrations capable of securing public revenues while facilitating trade and investment.

Beyond increasing government revenues, tax transparency has become a genuine instrument of economic policy. By reducing dependence on external borrowing, strengthening domestic resource mobilization, and improving public governance, it provides African governments with greater fiscal space to finance infrastructure, support industrialization, accelerate the energy transition, and invest in human capital.

The “Tax Transparency in Africa 2026” report confirms that modernizing tax administrations has become a strategic pillar of the continent’s development agenda. At a time when Africa is accelerating industrialization, expanding the AfCFTA, and seeking to finance the Sustainable Development Goals, tax transparency is emerging as a fundamental driver of economic sovereignty, competitiveness, and sustainable long-term growth across the continent.