The African Continental Free Trade Area (AfCFTA) is more than a trade agreement—it is a declaration of intent. It says Africa is ready to dream beyond colonial borders, to build new supply chains, to trade with itself more than with the outside world. But for that dream to take root, we must talk about the part of trade no one wants to touch: tax.
Trade may drive growth, but tax funds the infrastructure that supports it. If trade is the vehicle, tax is the engine—and right now, the engine is coughing.
Tax Friction in a Free Trade Era
Picture this: A Rwandan entrepreneur exporting fabrics to Kenya is met with a VAT regime she doesn’t fully understand. In Kenya, she has to register separately, deal with inconsistent customs valuations, and cannot access real-time support. She loses time, money, and trust. Multiply this story across 54 nations, and you’ll understand why tax—if not harmonised—may quietly undermine AfCFTA’s promise.
AfCFTA envisions the free movement of goods, services, and people. But on the ground, businesses still face taxes that are:
- Opaque
- Duplicative
- Unpredictable
The question is not whether tax matters in AfCFTA implementation. It’s whether we’re bold enough to build tax systems that match the scale of our ambition.
Why This Conversation Is Difficult (But Necessary)
Tax is deeply political. It’s how nations fund their priorities, enforce sovereignty, and measure control. For many African countries, taxes—especially border taxes—form a major source of revenue. Any talk of harmonisation raises understandable concerns:
- Will we lose fiscal autonomy?
- How do we meet domestic needs without import duties?
- Who decides which tax models win?
But if every country clings tightly to its tax status quo, the cost of cross-border commerce remains too high for small businesses. And AfCFTA risks becoming a paper tiger.
What Is Tax Harmonisation Anyway?
Tax harmonisation doesn’t mean every country has the same tax rates. It means that the rules, processes, and platforms become simpler, clearer, and more aligned.
Think:
- Common customs valuation procedures
- Regional VAT refund protocols
- Digital platforms that talk to each other
- A shared code of tax conduct
We already have early templates. The East African Community (EAC) has made efforts to align customs procedures. ECOWAS is exploring indirect tax coordination. These aren’t perfect—but they prove it’s possible.
The Case for a Shared Vision
1. To unlock scale for SMEs
Small businesses are already trading across borders. But many give up when they realise each new country requires new registrations, new compliance rules, and new penalties. Harmonised tax processes could reduce compliance fatigue.
2. To promote intra-African supply chains
If one country’s VAT is refundable while another’s is delayed for months, businesses are incentivised to export outside Africa where systems are more predictable. A shared vision brings consistency.
3. To attract investment
Investors love simplicity. A coordinated tax approach signals maturity, transparency, and cooperation.
4. To build trust
Tax fairness breeds faith in governance. When businesses feel heard and tax is seen as a service, not a punishment, they comply more—and push the economy forward.
How Do We Get There?
Africa doesn’t need to wait for perfection. It needs a process. Here are five building blocks:
1. Agree on principles.
We need a continental declaration on tax fairness, equity, digital readiness, and transparency.
2. Begin with low-hanging fruit.
Can we align on VAT refund timelines? Or digitise customs valuation uniformly? Small wins build momentum.
3. Invest in tax tech.
Let’s build platforms that integrate—not isolate. Revenue authorities should co-design solutions, not just adopt off-the-shelf models.
4. Involve the real economy.
Traders, startups, informal sector leaders—these are the ones who experience tax friction daily. They must help shape reform.
5. Train and support.
Tax administrators across Africa need consistent training, shared tools, and capacity-building programs that focus on people and systems.
What About National Identity?
This fear is valid: Harmonisation shouldn’t mean homogeneity. Countries can and should retain fiscal agency. But agency doesn’t mean isolation.
Think of it like language. Swahili is spoken across East Africa—not because everyone is the same, but because shared language builds shared futures.
We can keep our uniqueness. But we need interoperability.
Youth Must Be in the Room
More than 60% of Africa is under 35. Young people are building cross-border businesses on Instagram, TikTok, and Shopify. They’re trading. They’re moving. And they’re frustrated by outdated, analog tax systems that slow them down.
Harmonised tax policy isn’t just an economic issue. It’s a generational one.
Final Thoughts: The Time Is Now
AfCFTA is the scaffolding. But tax is the cement.
Without clarity, consistency, and collaboration on tax, we risk building a beautiful blueprint with hollow foundations.
Let’s ask the hard questions. Let’s imagine what’s possible. Let’s make tax work—not just for treasuries, but for people.
Can we build a shared tax vision for Africa without losing national identity?
We can.
And we must.