No one likes paying taxes. But everyone benefits when tax collection is efficient and fair. For almost all developing countries, building a more effective and trusted tax administration is critical. This not only helps finance much-needed social spending and infrastructure, but also reduces dependence on aid, now subject to its own pressures. It’s also a key pillar in building accountable, effective and respected government institutions.
Achieving this is partly down to good tax design. But it is also largely a matter of building strong tax administrations. This is not easy. A new instrument — the Tax Administration Diagnostic Assessment Tool, being developed at the International Monetary Fund with donor support and technical input from a wide range of experts — aims to help.
TADAT, welcomed in the communiqué of the First High-Level Meeting of the Global Partnership for Effective Development Cooperation, provides an independent, standardized, evidence-based, quality-assured, all-round assessment of the performance of a tax administration. All of these adjectives are critical, as will become clear. TADAT provides, in effect, a revenue-side analog to the highly successful Public Expenditure and Financial Accountability framework.
About the author
Michael Keen
Michael Keen is acting head of the TADAT Secretariat and deputy director of the Fiscal Affairs Department at the International Monetary Fund, where he was previously head of the Tax Policy and Tax Coordination divisions. Keen has as led taxation technical assistance missions to nearly 30 countries and consulted for the World Bank, the European Commission and the private sector.
