ARE THE TAX REGIMES IN AFRICA STIFFLING ECONOMIC DEVELOPMENT ON THE CONTINENT?

Tax regimes on the African continent vary from country to country. With Nigeria having one of the highest corporate tax rate of 30 % ,  it also relatively compares better on the Value Added Tax, at 7.5 % compared to Madagascar and Morroco which both have some of the highest rates on the continent at 20% while Cameroon is at 19.25%  which still is a heavy toll on the citizens of this countries.

Because of the high amount of debt loans in the continent of Africa to the World bank and the IMF and recently the debt influxx by China, the African nations have results to tax mechanisms to raise revenue to payback the loans. The increase in tax rates such as the corporate tax rates slows down foreign investment into the countries as most foreign companies are not drawn to the unattractive high interest rates therefore, holding back plans to set up shop on the continent and thereby depriving Africa the opportunity for industrialization.

With the three different types of tax regimes on the continent encompassing regressive, proportional and progressive tax, more citizen have founds loop holes to try and evade taxes which also deprived the countries of much needed revenue for development, therefore, necessitating African governments to borrow externally to fill up the budget deficit and other funding needs for the countries in areas such as food security, education, health and infrastructure development. 

As times changes, it is important for most African governments to adopt to the global economic changes. This will assure that the nations are not stuck with rigid tax systems that do not auger well with the development agendas of the countries. 

It is also imperative government involve the citizenry, in the dispensation of the tax system and create awareness through civic education to enable the citizenry understand their roles in tax payment and compliance with civic education initiatives such those by the Kenya Revenue Authority mandated with administrating taxes in Kenya and streamlining tax payment systems and platforms in Kenya.