Domestic Resource Mobilization: Getting Back to Basics

Steve Rozner

ICGFM DC Speaker Series

October 4, 2017

“…..in this world nothing can be said to be certain, except death and taxes.”

—Benjamin Franklin, in a letter to Jean-Baptiste Leroy, 1789

Why DRM?

Source: USAID

DRM: Part of the “social contract”

DRM the largest source of development financing

DRM: Growing, but fast enough?

UN “target”

IMF benchmark

The 2030 Agenda: A call to action

…and an answer to that call

DRM assistance works

8.0%

9.8%

10.7% 11.0%

10.6% 10.9%

11.8% 12.2%

13.8%

12.9%

13.8%

15.3%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Tax revenue as a % of GDP USAID Assistance

Improved tax administration

Tax r

atio

Tax and trade policy reforms

Progressive tax modifications

El Salvador Tax Ratio v. Periods of USAID Support

Global Financial Crisis

USG’s global DRM footprint

A framework for benchmarking DRM

TADAT: Distribution of scores across 36 countries

A - Very good 18%

B - Good 16% C - Basics in

place 25%

D - Of great concern

41%

Source: TADAT Secretariat, 2017

Where tax administrations are struggling most

Source: TADAT Secretariat, 2017

The lesson… Walk before you run

Focus on getting the basics right

Thank you!