Ethiopia Public Expenditure Review

World Bank Group

World Bank, Washington, DC

关键词: TAX INCENTIVES;    SANITATION;    WASTE;    DECISION-MAKING PROCESSES;    DEFICIT;   

RP-ID  :  ACS14541

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

Ethiopia’s remarkable socio-economictransformation over the last decade has been marked by: areorientation of expenditure from recurrent to capital; asignificant devolution of resources from Federal Governmentto Regions; and a clear prioritization of infrastructurespending, while protecting spending on education at fourpercent of GDP. The Government of Ethiopia has alsoleveraged external resources to boost spending in pro-poorsectors, particularly health and social protection. As aresult, Ethiopia is home to the largest social safety netprogram in Africa, and has also achieved remarkable healthoutcomes using cost effective approaches. Recent investmentshave seen a significant build-up of capital stock, withcapital spending at sector level pointing towards increasedservice capacity. The current public investment-led strategyrequires to be complemented by increased budgetaryprovisions in operations and maintenance so that newinvestments translate into enhanced service coverage anddelivery. As Ethiopia lays the foundation to become a middleincome country, and the changing global environment impliesdeclining external assistance, it is imperative thatdomestic taxation activity support this transition. Thecurrent tax-to-GDP ratio is low compared to peer countries,and the tax structure would benefit from increasedcontributions by direct tax sources. Therefore, there is animmediate need for advancing tax reforms and improvecapacity and quality of tax administration. Broadening thetax bases, through review of exemptions, as well as reviewof tax rates might be venues to consider. Additionalrevenues will create the much-needed fiscal space toincrease funding for operations and maintenance for servicedelivery, and support fiscal sustainability. As a follow-upto this Public Expenditure Review, the Government ofEthiopia has asked the World Bank to provide furtheranalytical support, with a view to enhance domestic revenuemobilization through simpler and more efficient taxation,while retaining equity priorities in public finances.