Taxes and Development

The Promise of Domestic Resource Mobilization

From 2000 to 2010, tax revenue on the African continent grew from $140.8 billion to $416.3 billion. The 2010 sum alone was eight times larger than the amount of foreign assistance received that year. As aid levels from wealthy nations remain uncertain, countries have an impetus to finance their own development, through improved tax collection and other methods, in order to deliver reliable public services in a transparent manner. This paper explores how domestic resource mobilization (DRM) fits into the current development finance landscape, how DRM emerged as a development priority, and how donors such as the United States can better support country’s DRM efforts to reduce reliance on aid and increase government capacity and accountability.

Conor M. Savoy

Conor M. Savoy

Former Senior Fellow, Project on Prosperity and Development

Christina M. Perkins