“Could the Palestinian Authority survive?” That was the question on many Palestinians’ minds when Salam Fayyad became finance minister in June 2002 and the cash-strapped government was struggling to pay its civil servants and suppliers. To avert a collapse, Fayyad quickly took steps to increase government revenue. He developed a system that would direct into a single, centralized treasury account all taxes, fees, and other income collected by government offices. He created a fund that consolidated the Palestinian Authority’s tangled and largely opaque commercial and investment assets and contracted with an outside firm to conduct a full audit of those holdings. He also took action to reduce smuggling and assert control over the tobacco authority and petroleum commission—two autonomous PA agencies plagued with management problems. The reforms required Fayyad to navigate political resistance and an entrenched administrative culture wary of financial transparency. Fayyad’s achievements enhanced efficiency, helped restart the flow of tax revenues withheld by Israel, and enabled the PA to attract external support and investment, quashing—at least temporarily—an existential financial crisis.

Tristan Dreisbach drafted this case study based on a series of interviews conducted with Salam Fayyad in Princeton, New Jersey, in 2019. The study also incorporates other interviews conducted in the Palestinian cities of Ramallah, Nablus, and Jericho in June and July 2019. The case is part of a series on state building in Palestine, 2002–05 and 2007–11. Case published March 2022.

After a decade of reforms to boost tax collection, in 2014 the Uganda Revenue Authority (URA) faced up to one of its biggest remaining challenges. Although the agency had significantly improved its internal capacity—along with its ability to collect taxes from registered taxpayers—large numbers of Ugandans paid nothing because they were unregistered or because inadequate compliance monitoring enabled them to underpay. The holes in the system undermined public trust and bedeviled the URA’s efforts to meet the government-mandated target to raise tax revenue to 16% of gross domestic product. The URA then joined other government agencies to bring millions of unregistered citizens into the tax net, and it tightened the oversight of existing taxpayers who were paying less than their fair share. Prime targets were millions of Ugandans who worked in the informal economy, which the government said accounted for nearly half of the country’s economic activity. At the same time, the URA set up operations to go after wealthy and politically connected individuals who avoided paying their full tax load, and it created a separate unit to press government departments that failed to remit to the URA the taxes they collected, such as withholdings from employees. The URA’s program achieved strong gains on all three fronts and thereby helped increase the country’s tax-to-GDP ratio to 14.2% in the 2017–18 fiscal year from 11.3% in 2013–14. Just as important, the program made significant progress toward a fairer distribution of the tax burden for Ugandans across all economic levels.

Leon Schreiber drafted this case study based on interviews conducted in Kampala, Uganda, in January and February 2019. Case published April 2019.

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See related Uganda Revenue Case Study: Righting the Ship: Uganda Overhauls its Tax Agency, 2004-2014

In the early 2000s, the Uganda Revenue Authority (URA) faced a crisis. Even after adopting a modernized legal framework that made the agency semiautonomous—able to operate much as a business would, though still accountable to a public board—the institution remained paralyzed by corruption, outdated technologies and procedures, and a toxic organizational culture. In 2004, to begin righting the ship, the URA’s board appointed 43-year-old Allen Kagina, who had served the agency for more than a decade, as the new commissioner general. Kagina engineered a radical overhaul that required all 2,000 URA staff members to reapply for new positions under a revamped organizational structure. A new modernization office overhauled tax procedures, upgraded the URA’s technology, improved anticorruption measures, strengthened the tax investigation and prosecution function, and enhanced staff capacity. At the same time, the URA was working to smooth its customs procedures and improve cooperation with partner countries in the East African Community. 

Leon Schreiber drafted this case study based on interviews conducted in Kampala, Uganda, in January and February 2019. Case published April 2019.

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See related Uganda Revenue Authority Case Study: Bolstering Revenue, Building Fairness: Uganda Extends its Tax Reach, 2014-2018

In its 2006 national vision to end poverty, Ethiopia set its sights on becoming a middle-income country by 2025. It was a hugely ambitious goal for a country that, at the time, was one of the poorest in the world. To support development objectives put on hold during a decade of political turbulence, including a costly border war with Eritrea that drained public coffers, the Ethiopian government sought to expand its resources by significantly boosting tax revenues. The new plan called for a sharp increase in the ratio of tax revenue to the size of the economy—and within four years. The government merged its separate customs and domestic tax offices into a single entity and restructured the new agency’s operations along functional lines, increased salaries, adopted stringent anticorruption rules, implemented a modern information technology system, and launched public awareness campaigns. It was important that the new revenue authority worked to improve its coordination with the tax offices of subnational governments, which operated with substantial independence under the country’s federal system. Although unproven charges of corruption against the Ethiopian Revenues and Customs Authority’s long-serving director general in 2013 stalled progress, a new round of IT and legal reforms in 2016 helped increase tax collection significantly: to US$7.8 billion in 2017 from US$1.3 billion in 2006 (measured in constant 2010 US dollars). Nonetheless, revenue gains continued to lag behind economic growth. In 2018, under a new prime minister, the government began to take further steps to strengthen tax collection.

Leon Schreiber drafted this case study based on interviews conducted in Addis Ababa, Ethiopia, in October 2018. Case published December 2018.

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Rwanda’s public health system was among the many casualties of the country’s 1994 genocide. In the aftermath of the violence, health workers were in short supply, maternal and child mortality rates spiked, and infectious diseases such as HIV/AIDs and tuberculosis often went untreated. By 2011, Rwanda had made enormous progress in remedying the situation, but much more remained to be done. From 2011 to 2016, officials in the finance ministry and health ministry worked together to develop five-year plans for public health, translate their new priorities into annual budgets, and monitor spending so as to ensure progress toward national goals. They revised the budget calendar to improve the planning process, helped local authorities build medium-term public-health strategies, and refined the tools used for tracking spending in the health sector. They met or surpassed more than half of the top targets they set for 2015, cementing the gains Rwanda had made since 1994.

Simon Engler drafted this case study with the assistance of Louise Umutoni Bower, based on interviews conducted in Kigali, Rwanda in March, April and August 2018. Case published September 2018.

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