Revenue Authorities and State Capacity in Anglophone Africa

Odd-Helge Fjeldstad, Mick Moore


What has driven the spread of Autonomous Revenue Authorities (ARAs) in Sub-Saharan Africa? What are their implications for public authority? This working paper from the Chr. Michelsen Institute, Norway, analyses the experience of ARAs in Africa.

Since the early 1990s, many countries in Sub-Saharan Africa, mainly Anglophone countries, have established ARAs organisationally distinct from Ministries of Finance, with some real operational autonomy, and with staff paid at rates substantially higher than those in comparable public sector jobs. ARAs are seen by some as a step to weaken the central state and to privatise tax collection. This is a misreading of the story of ARAs in Africa. ARAs remain under close government control both financially and politically.

Key findings of the study are:

  • Common factors across countries that have led to the adoption of ARAs include: tax evasion, corruption, dissatisfaction with performance in revenue collection, and high taxpayer compliance costs.
  • ARAs have facilitated a number of ‘nuts and bolts’ reforms in tax administration, improving efficiency and user-friendliness.
  • Donor interest in supporting these reforms has resulted in many similarities between African ARAs. Standardisation is not a problem as national financial institutions are relatively transferable.
  • Existing tax collection staff have generally been transferred into the new ARAs on substantially higher salaries compared to corresponding jobs in the public sector.
  • Inadequate separation of tax policy and tax administration, skewed distribution of tax burdens, and political interventions in day-to-day operations have decreased accountability of ARAs in some countries.

Establishing an ARA is not a ‘quick fix’ for a country’s revenue and tax administration problems. Creating the agency is expensive, time-consuming, and requires significant effort. However, an ARA can provide a platform from which specific and concrete changes to tax assessment and collection can be facilitated.

The ARA model also allows managerial autonomy to run a tax agency, outside standard public service procedures and the obstacles posed by them. Key policy pointers are:

  • Tax administrations need to cooperate with the Ministry of Finance, especially over tax and budgetary policy. If the ARA is established in a way that creates rivalry and jealousy with the Ministry, there will be problems.
  • Pluralistic governance arrangements are needed to ensure that ARAs are not abused by powerful Presidents either as sources of personal income or to intimidate political opponents. The personal relationship between the head of the ARA and the President is likely to be very important in the African context.
  • A Management Board of independent members, from inside and outside government, should control the ARA. They should have relatively long fixed periods of tenure.
  • Staff should be under the authority of the Chief Executive of the ARA.
  • Regarding the operational budget, one may argue two contrary principles:
    1. budgets that are independent of the annual budget process will free the ARA of direct dependence on politicians and increase the chances that it will not be subject to routine political interference; or contrarily
    2. only by justifying its budget request before the legislature annually can the ARA expect to establish broad political support for its operations.

    The difference of these views cannot be resolved by arguing from principles. In the long term, and especially in more fragile polities, managerial autonomy of the ARA survives only if it is earned, i.e. if it conforms to the interests of the political leadership.


Fjeldstad, O. H. and Moore, M., 2008, 'Revenue Authorities and State Capacity in Anglophone Africa', CMI Working Paper, no. 2008:1, Chr. Michelsen Institute, Bergen