UNDP introduces Country Engagement Plans - Strengthening the Linkages between TIWB and the Financing of the SDGs
by Ahtesham R. Khan (Project Manager-TIWB, UNDP) and Thomas Beloe (SDG Finance Advisor, UNDP)
16 December 2020
Domestic Resource Mobilisation (DRM) is critical to the achievement of Agenda 2030.1 However, many countries in Africa, Asia and Latin America have less than 20% tax revenue to GDP ratio, compared to nearly 34% for OECD member countries.2 The resulting revenue gap severely hampers the efforts of developing countries to achieve the Sustainable Development Goals (SDGs).3 The COVID-19 pandemic has further exacerbated the revenue gap leading to a decline in global human development for the first time in 30 years4 and it is anticipated that 71 to 100 million people5 will be driven to extreme poverty.
As a development organisation, UNDP and its Country Offices (COs) are supporting governments in articulating their development policies and planning instruments, as well as in mobilising and aligning different sources of finance behind their development priorities. Supporting greater domestic resource mobilisation and appropriate tax and fiscal policy frameworks are central to this agenda. UNDP COs will work with the Ministries of Finance and National Tax Authorities (NTAs) to develop Country Engagement Plans (CEPs) to outline how TIWB and other UNDP programming can best generate synergies while maximising the impact of the TIWB Initiative.
UNDP is already providing programmatic support to implement TIWB programmes. In Cambodia, Sierra Leone, and Uganda, the COs liaised with the NTAs to initiate the TIWB programmes. As of now, the COs in Angola, Bolivia, Comoros, Lebanon, and Tunisia, among others, are assisting in the establishment of TIWB programmes. The COs in Cabo Verde and Mongolia are providing interpreters and translators.
During the COVID-19 pandemic, COs are stepping up making available various digital means to support remote assistance. The Cambodia CO is in the process of providing licenses and training facilities to the tax administration to effectively use digital communication tools. As part of CEPs, UNDP will finance additional investment throughout its COs to make available technological support to NTAs in the form of access to hardware, conferencing facilities, secure data transfer and communication mechanisms through the course of the pandemic and beyond in order to effectively deliver remote TIWB expertise.
Under the CEPs, UNDP’s will also work to support NTAs link TIWB programme work with broader systemic tax reforms. In a number of countries, UNDP COs have already helped TIWB experts support tax administrations join in discussions to mobilise broader support for tax reform and domestic resource mobilisation. In Jamaica, the CO helped the TIWB expert present at a local university in an effort to reach out to a wider support base. In Uganda, the CO organised a stakeholder engagement session highlighting the benefits of robust transfer pricing legislation.
UNDP COs will also work to draw together their broader portfolio engagements with tax authorities, Ministries of Finance (e.g. supporting the development of Integrated National Financing Frameworks for the SDGs) and Sector Ministries (e.g. with respect to health or environment tax). These Frameworks will provide governments with a structure and direction to harness tax and fiscal policies to help achieve the SDGs, whether in health, climate or on issues of equity, for example, while also enhancing co-ordination and collaboration across complementary taxation initiatives.
UNDP is looking forward to strengthening its country engagement to maximise the impact of TIWB, as part of its broader efforts to mobilise domestic resources and align tax and fiscal policy behind the SDGs. TIWB has a critical role to play as we build a better future in the wake of the pandemic and beyond.