An Impact Assessment of Domestic Revenue Mobilisation in the Gambia: Issues and Challenges

Domestic revenue mobilisation plays a critical role in the development strategy of national economies. It is a challenge for developing and transitional economies, inclusive The Gambia who find it difficult to channelize adequate revenue. This is as a result of entirely depending or relying so heavily in meeting government’s development financing of its development budget and programmes, as a result of not been endowed with natural resources. This research focuses on an impact assessment of domestic resource mobilisation for transitional economies with an emphasis of a case study on The Gambia. This is because national economies are in the quest for more sustainable and veritable sources of income to finance the budgetary processes of their economies. The objective of the research study is to examine the impact of domestic revenue mobilisation in The Gambia. To achieve this objective, the Gambia Revenue Authority is been used as an example for this purposeful research project in order to extensively determine the major macroeconomic factors influencing domestic revenue mobilisation in The Gambia. In addition, is to also analyse the machinery of internally generated revenues and to examine the impact of domestic revenue mobilisation in The Gambia in terms of development financing, debt repayment and percentage contribution to the GDP, hence focusing on the Gambia Revenue Authority. The researcher used primary and secondary methods of data collection to generate the needed data. The data obtained through questionnaire was presented in tables and expressed in simple percentages, using chi-square. The research reveals significant positive relationship between economic growth, economic development, revenue performance and domestic revenue mobilisation. The following were some of the findings which the researcher has identified as critical challenges impeding optimal revenue generation. This includes: lapses in the tax systems as a result of weakening or ineffective enforceability of the administrative, collection, audits and enforcement provisions of the said Income and Sales Tax Act (2004) regarding the tax handles due to over-reliance of “Best of Judgment” and capacity gaps, ineffective taxpayer education and sensitisation programmes, high tax rates, heavy handedness in the collection, lack of manpower and highly qualified personnel to steer the affairs of revenue generation and tax administration. Subsequent to the identified constraints limiting the maximal collection of domestic revenue mobilisation, the researcher therefore, proposed numerous recommendations which could assist in increasing the collection base. Principal among the recommended proposals is for the revenue authority (GRA) to put in place a more robust and proactive compliance strategies and risk management approaches, invest in automation in order to graduate from manual systems of filing and recording to automated filing and reporting processes, and to pursue an all-mutually-inclusive, rigorous and relevant taxpayer education programmes in order to transform ignorance into awareness, hence exerting a self-regulated voluntary compliance culture in the payment of taxes. By doing so, the system will be saved from systemic frauds; aggressive tax planning and the taxpayer’s equally would be motivated with an unquestionable interest in meeting their tax obligations and on time. Therefore, the results of this study can inform policy makers on the extent to which domestic revenue mobilisation can be a key driver towards achieving any meaningful socio-economic growth and development.