A Survey by the Association of Chartered Certified Accountants (ACCA), International Federation of Accountants (IFAC) and Organisation for Economic Co-operation and Development (OECD) has shown that nearly half of African taxpayers don’t see their taxes being spent for the public good.
According to the survey, Africa has a net positive trust in tax authorities of 34.1 per cent, while 55.6 per cent see taxes as a primarily law and regulation in Africa.
The survey titled ‘Public Trust in Tax 2024: Latin America and Beyond’ also shows that globally only 33 per cent agree that tax revenues in their country are spent for the public good (46 per cent disagreeing, rest neutral).
Africa painted a slightly more encouraging picture with 38 per cent of African taxpayers agreeing that tax is spent for the public good, while 43 per cent disagreed (rest neutral).
A statement released by ACCA noted that across the globe taxpayers support the idea of a fiscal contract – citizens agreeing to pay tax in exchange for services – but a global poll suggests that only a third see the deal working in practice.
The however survey found that 52 per cent of respondents agree that taxes are a contribution to the community rather than a cost (25 per cent disagree, rest neutral).
Africa in contrast, nearly two thirds (21 per cent strongly agreed and 44 per cent) agreed with the statement ‘taxes are a contribution to the community rather than a cost to me’, while only just under 20 per cent disagreeing.
The 2024 survey which focused on some of the largest countries by population in different regions of the world, marks the most significant expansion of the work to date, both in terms of questions asked and countries covered.
Africa and Asia both sees tax as a matter of law compared with Latin America. In Africa 55.6 per cent see it as primarily law and regulation, 13.8 per cent as morals and fairness and 30.6 per cent as an equal blend.
In Asia the figures were similar (52 per cent 36 per cent and 12 per cent). But in Latin America at 38.9 per cent law and regulation was below an equal blend of 44.3 per cent and the moral score was highest across the globe at 16.8 per cent.
Director of Africa, ACCA, Jamil Ampomah, said: “This is a groundbreaking study of public trust in tax in Africa. And while there is much in the research which is encouraging – especially compared with other regions of the world – we need to ensure the dialogue among governments, policy makers and stakeholders continues. We need to see public trust in tax maintained to help ensure sustainable development”.
Also, George Njari, Head of Eastern Africa at ACCA said “trust in tax systems is crucial for sustainable development and prosperity, and the findings of this survey highlight the challenges that many governments across the world face in building it.
“We look forward to using this important work to engage with policymakers, tax authorities and civil society to drive evidence-based policy initiatives to build effective and trusted tax systems.’
Countries in Africa surveyed were Angola, Egypt, Cote d’Ivoire Kenya, Nigeria.
Other key results are recorded in the survey include “Africa has a net positive trust in tax authorities of 34.1%, not as high as Asia’ 38.9% but in sharp contrast to Latin American’s negative rating of 4.2%.
“Women expressed slightly more positive sentiments about interactions with tax authorities than men in Africa and Asia, but this position was reversed in Latin America.
“Africa shares a similar view with other world regions that cheating on taxes is never acceptable at 63.6% with an average score across the globe of 61.5%”, the statement said.
It is worthy of note that in Africa there is significant variation across the five sampled countries, with Egypt and to a less extent Cote d’Ivoire tending to have more positive views on taxation than the other countries.
Commenting on the finding that tax accountants are the most trusted source of information on tax, and politicians the least, Lee White, CEO of IFAC, said “Consumer and investor protection is the foundation for economic prosperity, which aligns with building trust in the tax ecosystem.
“As the survey confirms, and in line with previous editions, professional tax accountants are the most trusted source of tax information globally.
“This trust places an enormous responsibility on our profession to act with integrity, to bridge the gap between governments and taxpayers, and to uphold the highest standards of ethics”.
Manal Corwin, Director of the OECD Centre for Tax Policy and Administration also added “we are pleased to join with ACCA and IFAC on this key research.
“The findings in this report highlight that support for the fiscal contract remains strong in theory, but it’s not being delivered in practice for many. We can use these findings to identify how to rebuild trust in both the theory and practice of tax across the globe”.