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Strengthening Tunisia’s Tax and Customs Systems to Promote Economic Growth

The Tunisia Tax and Customs Reform Pilot Activity is supporting the government to enact new tax reform, modernize its approach to tax administration, and adopt improved customs operations that align with international best practices.

Tunisia is in the midst of an economic transition, and improving the country’s tax and customs systems plays a key role in ensuring the long-term success of this structural shift. The objective of the Tunisia Tax and Customs Reform Pilot Activity (TCP) is to support this transition by facilitating tax administration and customs reform goals vital for stability and economic growth.

The program aims to improve fiscal balances and enhance the effectiveness, fairness, and transparency of tax and customs compliance, establishing an economic foundation to increase inclusive growth and private investment. The program, funded by USAID, works in partnership with the Ministry of Finance, General Directorate of Legislative and Fiscal Studies, General Directorate of Taxes, General Directorate of Public Accounting and Recovery, and General Directorate of Customs to achieve these goals.

The program works toward the goals through three main strategies. First, to facilitate tax policy reform, program staff support the Tunisian government in adopting a tax policy framework that is consistent with international best practices. This also involves strengthening the capacity of government agencies to effectively perform policy reform. Second, program staff support the government in modernizing its approach to tax administration to boost public confidence and trust in the system. Related activities include strengthening audit processes, improving outreach services, and simplifying registration services.

Third, TCP guides the government in adopting customs operations consistent with international best practices with the broader goal of advancing Tunisia’s implementation of the World Trade Organization’s Trade Facilitation Agreement. Activities under this component focus on strengthening coordination between customs administrators and the private sector.

Broadly, the program helps the Ministry of Finance more effectively develop and manage tax and customs policies in a way that is efficient and transparent. Tools such as micro-simulation models play a particularly critical role in demonstrating the usefulness of reviewing reforms to personal, corporate, and consumption taxes as one package rather as individual tax reforms. This change in perspective will go a long way in enabling the ministry to propose progressive changes that accomplish a national goal of implementing fair and transparent reform that has little to no impact on the budget.

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