Ethiopia

Tax, Audit and Transparency Program

Outline

Diagnostic, stabilization, development and leveraging of tax systems


Description

C2D assisted the Ethiopian Revenue and Customs Authority (ERCA) in its efforts to mobilise revenues. Indeed, the utilisation of robust IT tax systems, in line with modern tax processes and practices, was identified as one of the strategic vectors of modernisation, especially in a country with a vast population and a large territory.

The biggest challenge ERCA faced was that both its main systems – the main back-office system and the taxpayers online services platform - have not been maintained in line with the ever-evolving needs of ERCA, therefore creating a gap between systems and business processes. This in turn led to a variety of issues such as poor data, weaknesses in tax processes, suboptimal audit capabilities, etc., all translating into lower levels of revenues as well as greater risks of tax evasion.

C2D’s role has been to stabilise the systems, ensure their availability to both ERCA employees (back-office) and the taxpayers’ community (online services), ensure adequacy between the functionalities of the systems and the tax processes, train ERCA staff on their utilisation, and support the cleansing of the data so it can be used for decision-making.

One of the innovations introduced by C2D in support of the delivery of this assignment was a Business Intelligence data warehouse that leverages existing data, cross-references it with other sources of fiscal data, and improves decision-making through real-time up-to-date Key-Perfomance Indicators for Managers, automated risk criteria to Auditors, and automated workflows for the Enforcement department. This innovative new data warehouse allows ERCA to extend the life of its current systems without having to heavily invest in them, leverage its existing data, all the while mobilising revenues.

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