Africa loses $89bn annually to illicit financial flows – Tax experts
Experts from the West African Tax Administration Forum (WATAF) and Tax Justice Network Africa (TJNA) have disclosed that African countries lose about 89 billion dollars annually to illicit financial flows (IFF). Speaking during an interactive session with ECOWAS parliamentarians at the ongoing 2026 First Ordinary Session in Abuja, they said the losses stemmed from harmful […]
Experts from the West African Tax Administration Forum (WATAF) and Tax Justice Network Africa (TJNA) have disclosed that African countries lose about 89 billion dollars annually to illicit financial flows (IFF).
Speaking 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.
They said the harmful tax practices included tax evasion, tax avoidance, and tax mis-invoicing, 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 89 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.
Dr Nita Belemaobgo, Research Manager, WATAF, while highlighting the session’s expected outcomes, said the organisation’s objective was to support ECOWAS’ transition on tax directives aimed at harmonising fiscal policies across member states.
“Regional cooperation and evidence-based tools can significantly enhance accountability and reform outcomes,” she said.
Danicius Sengbeh, WATAF’s Manager, Communications and Information Technology, underscored the importance of setting regional tax harmonisation and domestic resource mobilisation.
He said the ECOWAS Parliament had an indispensable role to play in the oversight function of tax administration, adding that the engagement was about “sovereignty, fairness, accountability and West Africa’s future.”