Experts from the West African Tax Administration Forum (WATAF) and Tax Justice Network Africa (TJNA) say African countries lose about $89 billion annually to illicit financial flows (IFF). Speaking on Thursday during an interactive session with ECOWAS parliamentarians at the ongoing 2026 First Ordinary Session in Abuja, they said the losses stemmed from harmful tax practices affecting their economies.
The session also featured presentations on “Operationalising ECOWAS Tax Directives for Domestic Resource Mobilisation and Regional Tax Harmonisation”, among others. They said the harmful tax practices included tax evasion, tax avoidance, and tax misinvoicing, among others, adding that Africa’s persistent domestic resource mobilisation gap was about 194 billion dollars annually.
“Africa has a prevalent problem of illicit financial flows, and at least 65 per cent of these could be categorised as commercially driven. “The main practices that could lead to IFFs are tax evasion, tax avoidance, tax misinvoicing, and other harmful tax practices.
“These harmful tax practices haemorrhage the available resources that can be used for development of the continent, and Africa loses up to eighty-nine billion dollars annually,” they said, quoting a 2020 report. According to them, advancing tax harmonisation within the ECOWAS sub-region presents a strategic opportunity for WATAF to strengthen regional integration, enhance domestic resource mobilisation, and support sustainable development.
“Tax harmonisation is the fiscal backbone of ECOWAS integration. Without it, the region will continue to lose revenue through loopholes, smuggling, opacity, and profit shifting,” they said. However, they emphasised that the effectiveness of such efforts would depend on strong political commitment, effective implementation at the national level, and active parliamentary oversight.
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