Sustained domestic revenue mobilization (DRM) is crucial for developing countries to finance economic growth, achieve their development priorities, and build resilience to climate shocks. However, low tax-to-GDP ratios and costly tax incentives can undermine fiscal sustainability. Eighteen low-income countries (75%) and twenty-two lower middle-income countries (46%) collect tax revenue below 15% of GDP, a threshold above which countries can expect significant increases in growth and expenditure on key pro-poor investments (Choudhary, Ruch, and Skrok, 2024). Although many tax incentives fail to deliver promised economic benefits, opposition to reform tends to be stronger than support. Vested interests hinder reform efforts and diffuse, invisible costs make it challenging to mobilize support. This Academy Program will help equip policy makers with the tools and knowledge needed to design reforms that enhance transparency, efficiency, and revenue generation.
In partnership with Oxford University’s Blavatnik School of Government and regional organizations such as ATAF and ECOWAS, the World Bank Group’s DRM Academy Program will bring together Ministries of Finance, tax authorities, line ministries, parliamentarians, and private sector representatives to develop country-specific pathways for designing and implementing tax incentive reforms. The program will leverage cutting-edge knowledge, analytical solutions, peer-to-peer learning, and country case studies from successful tax incentive reforms. Specifically, the program will:
- Through training government officials, strengthen policymakers’ capacity to conduct transparent reporting and assessments of tax incentives (and expenditures more generally) and improve oversight using best practices and real-world case studies.
- Support governments to develop centralized tax incentive data, strengthen monitoring systems, apply economic assessment methods, develop legislation, and consult and communicate reforms to limit ineffective tax incentives.
- Facilitate structured engagement with the private sector to best align incentives with economic goals and implement phased reform strategies that minimize resistance.
By enhancing transparency, institutional capacity, and stakeholder collaboration, the DRM Academy Program will support countries’ transition to a more efficient, equitable, and revenue-generating tax system.
Program initiation: September 2025, Oxford