Fair Tax Monitor (FTM)

ABOUT PROJECT

Consumer Unity and Trust Society (CUTS) International, Lusaka in in collaboration with Oxfam are carrying out a Fair Tax Monitor (FTM) for Zambia. The FTM project started in December 2014 and was developed by Oxfam Novib and Tax Justice Network – Africa.
The Zambian economy has been on a path of economic recovery in 2018 following the negative performance of major macroeconomic indicators over the past three years. The economy grew by 3.7 percent in 2018 and is projected to slow down to 2.3% in 2019 mainly due to continued adverse weather conditions which will negatively impact agriculture production and the energy sector
Zambia’s fiscal performance remains a challenge as debt levels have been recorded as high as 70 per cent of GDP. This is largely due to Zambia’s limited domestic revenue sources. As the debt has continued to escalate, domestic resource mobilization (DRM) has become a top government agenda to ensure that Zambia is better placed to fund its own development.
DRM in Zambia comes in different forms including various taxes, levies and fees. Efficient tax collection is important to a country like Zambia because it is the biggest source of long-term financing for sustainable development and the determinant of good governance in terms of: high quality service provision; holding government to account; and citizens participation in the management of public funds. Efficient and effective tax collection coupled with economic growth is the remedy to long term aid and debt dependency and increased policy space to implement strategies that reflect the country’s development plans.
Given the above context, the Consumer Unity and Trust Society (CUTS) sees the need to take up a study that will focus on influencing tax policy reform in Zambia backed by evidence-based research. CUTS has taken note of the work conducted by OXFAM and Tax Justice Network Africa (TJNA) regarding promoting fair taxation particularly the “The Fair Tax Monitor” initiative. This work is in line with CUTS objective to promote prop poor tax policies as well as strengthen the work of its network such as the Zambia Tax Platform.
The Fair Tax Monitor’s overall goal is to strengthen the advocacy activities at the local and global levels. It provides an overview of national tax systems and identifies the main challenges they face. The tool provides reliable evidence for the advocacy and lobby work, which strengthens our position and increases our credibility as well as influencing power. Furthermore, the FTM compares key elements of tax systems and thus complements the activities of Oxfam’s global Even it Up! campaign and TJN-A’s activities realized at the African level. The project’s focus is on tax policies and practices, and by deliberate choice it pays only limited attention to issues related to public expenditure.
Noting the goal of the Fair Tax Monitor is to help provide reliable evidence for the advocacy and lobby work relating to tax policy reform, the tool will be useful for a country like Zambia and also the Southern African region.