West Africa Pushes Ahead with VAT Digitalisation Reforms

The West African Tax Administration Forum (WATAF) outlined efforts to support member countries through training programmes, data-sharing initiatives and stronger coordination between tax and customs authorities.

Government officials, tax authorities, regional institutions and business representatives gathered in Abidjan to discuss how digital technology can strengthen Value Added Tax (VAT) collection and improve domestic revenue generation across West Africa. The regional seminar, titled "Empowering Smarter VAT Compliance: Innovations and Regional Collaboration in West Africa," was organised by the African Development Bank Group with support from the Government of Japan through the Policy and Human Resource Development Grant.

More than 230 participants attended the hybrid event, reflecting growing interest in modernising tax systems at a time when many countries are facing tighter budgets and declining levels of external development assistance. VAT remains one of the most important sources of government revenue across Africa, accounting for roughly 30 per cent of tax collections in many countries. Despite its importance, tax authorities say collection efficiency remains relatively low, creating opportunities for reforms that can improve compliance and reduce revenue losses.

Digital tools helping countries improve tax compliance

Opening the seminar, African Development Bank West Africa Director General Lamin Barrow described VAT digitalisation as more than a technical upgrade, saying it can strengthen transparency, improve trust between governments and taxpayers, and increase the effectiveness of tax administration.

Participants reviewed several examples of reforms already underway across the region.

In Côte d'Ivoire, authorities have expanded the E-Impôts platform, allowing taxpayers to file returns and make payments online. Electronic invoicing systems are also being introduced to improve transaction tracking and reduce opportunities for tax evasion.

Nigeria is rolling out its National Revenue Service Merchant Buyer Solution, a real-time electronic invoicing platform initially targeting large taxpayers. Ghana is using digital tools and data analytics to tackle VAT collection gaps, particularly in monitoring imports.

Togo has introduced online filing and payment systems through its Revenue Authority, while Senegal continues to expand its ETAX platform despite technical challenges related to system integration and capacity.

Officials also examined lessons from East African countries, where digital VAT systems have already delivered improvements in compliance rates, revenue collection and transaction monitoring.

Regional cooperation seen as key to future success

A major theme of the discussions was the importance of regional collaboration in strengthening tax systems.

The Economic Community of West African States (ECOWAS) reported that VAT currently contributes about 31.4 per cent of tax revenue across the region and highlighted a pilot project with Sierra Leone aimed at improving VAT collection on cross-border digital transactions.

The West African Tax Administration Forum (WATAF) outlined efforts to support member countries through training programmes, data-sharing initiatives and stronger coordination between tax and customs authorities.

Private sector participants stressed that successful digitalisation must remain practical for businesses, particularly small and medium-sized enterprises. Concerns were raised about compliance costs, internet connectivity, system compatibility, delays in VAT refunds and the need to improve digital literacy.

Looking ahead, participants explored how emerging technologies such as artificial intelligence could help strengthen compliance monitoring and tax administration. They agreed that investments in infrastructure, capacity building and stakeholder cooperation will be essential if VAT digitalisation is to deliver its full potential.

The seminar concluded with broad agreement that modernising VAT systems could become one of the most effective tools for strengthening domestic resource mobilisation and supporting long-term economic development across West Africa.