AfDB leads talks on VAT reform in Africa

NAIROBI, Kenya: AS part of its strategic effort to modernize tax systems and boost revenue collection across the continent, the African Development Bank (AfDB) has organized a groundbreaking seminar focused on innovative approaches to Value-Added Tax (VAT) compliance.

The seminar under the theme ‘Driving Smarter VAT Compliance’ focus on East African economies, that brings together a diverse array of participants including government officials, tax administrators, private sector innovators, and development experts will be held on 17 June, 2025 in Nairobi.

The goal is to address the pressing challenges facing (VAT) systems across the continent, while spotlighting the transformative power of digital innovation.

According to the statement released by the AfDB Regional Communication Office for East Africa, VAT remains one of the most significant sources of domestic revenue in African countries. However, its potential is often undermined by widespread compliance gaps, administrative inefficiencies, and limited use of modern digital tools.

These issues hinder countries from collecting the full potential of VAT, ultimately affecting public service delivery and fiscal stability.

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The AfDB’s initiative aims to reverse this trend by encouraging smart, scalable solutions.

“VAT remains a major source of revenue in African economies but suffers from compliance gaps, administrative inefficiencies and digital infrastructure challenges. The “Driving Smarter VAT Compliance” seminar will showcase innovative practices in e-invoicing, e-filing, and audit automation, while offering a platform for knowledge sharing among East African countries,” said part of statement.

Through collaborative dialogue, the event promotes cross-border learning and a shared vision for reform. The workshop will also highlight the global trends in tax administration digitalization and their implications for African economies. It will also explore how digital technologies can enhance the efficiency, transparency, and equity of value-added tax systems across Africa.

One of the key objectives of the seminar is to facilitate public-private partnerships in the digital tax space and inform the Bank’s ongoing support to tax reforms.

By fostering closer cooperation between tax authorities and technology firms, the event seeks to catalyze the development of tailor-made digital tools that respond to local contexts. Such partnerships are seen as essential to building agile tax systems that can adapt to changing economic conditions and emerging business models.

The forum also provides an opportunity to align national reforms with global trends in tax administration. As many countries around the world move toward real-time data processing, blockchain-enabled tax tracking, and AI-powered audits, African economies are looking to leapfrog into modern tax governance.

The AfDB is committed to supporting this transformation through policy advice, technical assistance, and capacity building.