For a fair and equitable taxation of the digital economy, several recommendations were made yesterday, after the first international conference on the taxation of the digital economy in Africa organized by the Foundation for Capacity Strengthening (ACBF), dismemberment of the African Union (UA). It was thus considered necessary, among other things, to “provide tax administrations with the skills and tools necessary to effectively manage taxation in this sector”.By Dialigué Faye –
The curtains fell yesterday on the first international conference on the taxation of the digital economy in Africa. Several recommendations were thus made to meet the challenges and seize the opportunities of the digital age.
Stressing the importance of aligning tax policies on innovation and capacity building needs of tax administrations for example, delegates representing African governments, regional organizations, international organizations, civil society … have suggested “to invest significantly in training and capacity building initiatives, in order to provide tax administrations and tools necessary to effectively manage taxation taxation in the digital economy ”.
The conference also called “to strengthen collaboration and partnership between organizations such as the AU Commission, the BAD, ACBF and other relevant institutions, to meet the identified need for human and institutional capacity building”. Tax administrations are also invited to “give priority to the integration of data systems and the automation of tax processes, in order to improve efficiency, to provide real -time access to information and to rationalize tax collection efforts in the digital economy”. Cheikh Mouhamed Hady Dièye, coordinator of the Directorate General of Taxes and Domains (DGID), who presided over the closing ceremony of this meeting, recalls that “our States accuse a significant delay in many areas, in particular because of the funding deficit which forces us to use heavy loans to bear or to donations subject to sometimes unbearable conditionalities. Thus, the growing need for resources to finance public policies, but also the requirement of equity in income taxation requires exploring areas that can contain under-exploited tax potential. The digital economy is one of these sectors which escape exhaustive taxation due to several factors, in particular the virtual nature of transactions and the cross -border nature of exchanges ”. And faced with such a situation, considers Mr. Dièye, “tax administrations must naturally organize the response, by strengthening the capacities of their staff, so that the income generated on their territory do not escape tax”.
A jurisdictional overlap and a lack of tax managers harmonized between countries, which complicate the effective taxation of digital companies, were noted during the sessions. And to remedy this, the participants called “to a unified digital tax strategy which would bring clarity and coherence through the borders”. In their opinion, “African nations should collaborate to create a continental strategy and policy harmonized on the taxation of the digital economy which approach jurisdictional overlaps and promote coherence through borders, thus facilitating a fair taxation of digital companies”. The ACBF Executive Secretary specifies that “despite the difficulties encountered”, the participants “managed to agree on a common position, namely that no African country can go on a rider alone in the taxation of the digital economy”. Given this fact, says Mamadou Bitèye, “a collective effort is necessary to jointly develop human and institutional capacities in Africa, mobilize global efforts to plead for fair tax rights and strengthen knowledge sharing between African countries”.
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