National Tax Policy Specialist

Maputo
Consultant, Long Term, Full-Time
10-23-2020
Maputo
Commensurate with Experience 
Job stage: Immediate Opportunity Wage: Commensurate with Experience
Position Type: Consultant, Long Term, Full-Time
Closing On: 12/11/2020
Posted: 10/23/2020
Country: Mozambique

Taxing Efficiently for Developing Inclusively – Mozambique (TEDI, Tributação Eficiente para Desenvolvimento Inclusivo)

National Tax Policy Specialist

SUMMARY OF THE PROJECT 

Background

The Government of Mozambique (GoM) had overseen impressive economic growth and poverty reduction for a sustained period after the civil war, which ended in 1992, however this stalled in 2017. This was due to a financial and debt crisis caused in part by undisclosed illegal loans and subsequent suspension of general budget support and the IMF country programme. While the macroeconomic situation has stabilized since the crisis, successive cyclones and the COVID-19 crisis have exacerbated public finance constraints even further, making the need for efficient and equitable domestic resource mobilization critical.

The exploitation of major natural gas reserves is likely to boost GDP and government revenues in the medium term, although investments in these gas fields have suffered a series of recent setbacks and delays, and expectations of future revenue need to be managed.

Mozambique underwent a series of reforms to the taxation system with the creation of an independent revenue authority in 2006; however there has been no major revision of tax policy in the last decade.

Mozambique has one of the highest tax to GDP ratios in the SSA region, in fact in 2019, tax-to-GDP was registered as 25.32% (including capital gains)[1]; the SSA average for 2017 being 15.64%[2]. In terms of the outturn for 2019, Mozambique registered an above target collection of tax revenue – achieving the target by 113.13%. The split between domestic taxes and trade taxes is approximately 75% and 25%, respectively.

However, in order to maintain this performance, there is a need to establish a more comprehensive approach to tax policy to ensure that it is coherent with the development objectives of the country, including concerns around the business environment, tax incidence and gender and social inclusion.

The TEDI Project

The Ministry of Economy and Finance (MEF) has expressed to the UK Government its desire to ensure increased tax revenues allied with considerations for widening the tax base, determining efficient rates for various taxes, and alignment of the tax policy with national development objectives for inclusive growth. Objectives of any tax reform will, according to the MEF, need to focus on improving the business environment, stimulation of investment, production and job creation, as well as reducing informality and combating evasion. In order to design a tax policy that comprehensively responds to these concerns, MEF needs the analytical capacity to study these issues, formulate policy proposals, and draft any legal instruments that result from tax policy decisions.

While the mandate for definition of overall tax policy lies with the MEF, due to limited capacity policy has been made at times by the revenue authority, or in an ad hoc and unsystematic way. Capacity therefore needs to be increased within the MEF in order for it to wholly fulfill its role as tax policy maker, while enabling the Revenue Authority to carry out its mandate as the implementer of such policy. In order to build the capacity of the MEF to do this, robust technical assistance over a significant period, to ensure absorption, is required.

The GoM has therefore requested the UK Government to support ongoing resident technical assistance on tax policy (covering analysis, forecasting methods, support to definition of a coherent approach to tax policy across all taxes, and drafting of resulting policies and legal instruments, and strengthening of the link between policy and implementation). The principal focus of the tax policy support would be the Department of Economic Policy and Development (DEPD); however support may also be required to the legal department with regard to drafting of legal instruments to reflect changes in policy.

This role is an integral part of a FCDO–funded technical assistance programme to support domestic resource mobilization in Mozambique - the Taxing Efficiently for Developing Inclusively (TEDI) project. The FCDO has committed £8million over 5 years, with £5million reserved for technical assistance accompanied by a £3 million procurement fund to support capacity-building activities.

The overall objective of TEDI is to contribute to strengthening economic management for inclusive growth, by assisting the GoM in raising tax revenues efficiently and equitably, and increasing tax compliance. This requires support principally to the Revenue Authority and the MEF.

Three outputs are defined for the project as a whole:

  1. Output 1: An efficient, risk-based and customer-centric revenue system that is effectively administered to enhance voluntary compliance
  2. Output 2: Capacity is strengthened to efficiently and effectively administer the extractives industry tax regime 
  3. Output 3: Improved equity, transparency and coherence of tax policy.

These three outputs are organized into three main pillars of work – i) tax administration, ii) tax policy and iii) customs administration. Gender and Social Inclusion, Extractives Industries, and response to and recovery from the COVID 19 pandemic are considered cross-cutting issues.

ROLES AND RESPONSABILITIES 

The main focus of the National Tax Policy Specialist will be to contribute to Output 3 under the guidance of an International Tax Policy Specialist, however his/her collaboration with other members of the TEDI team working on the other outputs will be important.

If the restrictions due to COVID-19 prevent the International Tax Policy Specialist from coming, the National Specialist will be responsible for acting as the liaison between the International Specialist and DNPED, and the national technical staff allocated to the team. He/she will also be responsible for representing the project and coordinating the day-to-day work under the guidance of the International Specialist until he/she arrives.

The National Specialist will be based in the Directorate of Economic Policy and Development (DEPD), together with a resident International Tax Policy Specialist and the technical staff of the DNPED. The team may, at a later stage, be converted into a Tax Policy Unit, depending on the aspirations of the MEF. Whether or not a Tax Policy Unit is established, the Specialist is expected to carry out all activities in an inclusive manner, in coordination with the DNPED staff assigned to the project, with a view to enhancing knowledge transfer and capacity building.

The main initiatives and responsibilities include supporting the international tax policy specialist in:

1) Creating an Evidence Base for Tax Policy

  • Designing and coordinating comprehensive studies that would allow the MEF to make sound tax policy decisions. These may include impact studies, analysis of exemptions and tax expenditure, or research into specific tax considerations such as the differential impact of certain taxes on gender. MEF has already identified the following priorities:
  • Evaluation and analysis of the efficiency and fairness of the main taxes (VAT, Personal Income Tax, Corporate Taxes, Excise Duties and simplified regime for small taxpayers);
  • An analysis of sensitivity to changes in tax rates and reduction/elimination of certain exemptions;
  • assessment of potential revenue and efficiency gains from proposed reforms.
  • In the short term, analysis of rapid response policies, as required, for the daily decision-making processes of the MEF. This could include cost-benefit analyses of proposed decisions, support to senior management in relation to tax policy interventions and the introduction of international experience in the discussion of tax policy within the MEF.
  • Collaboration with research institutions and CSOs on relevant studies, with a particular emphasis on the gender inclusion and social inclusion aspects of taxation.
  • Analysis of the state of play of double taxation treaties and development proposals
  • Development of IFMIS reports (SISTAFE) and other tools to allow the MEF staff to monitor tax revenues and support staff on how to use them. 

2) Revenue Forecast

  • Technical assistance, training and support to incorporate the use of revenue forecasting models by tax type;
  • Supporting the DNPED in submitting revenue estimates to the Planning and Budgeting Directorate for the medium-term fiscal scenario, as well as the preparation of the State Budget;
  • Supporting the DNPED in making contributions to the forecasting process, reporting assumptions and analysis on the drivers of revenue forecasting performance for senior staff as appropriate;
  • Assisting the DNPED in assessing the performance of previous years' forecasts against the actual performance, and making adjustments to improve the forecasting models as necessary;
  • Promoting collaboration with the Tax Authority to ensure that the revenue forecast is aligned between the two institutions.

3) Monitoring and Reporting of Tax Expenditure

  • Coordination and support to quarterly and annual tax expenditure reported to the MEF and State Budget documents, including improving data quality and data sharing protocols between the MEF, the AT and other government entities;
  • Developing and deploying models/instruments to estimate and forecast tax expenditures;
  • Develop a programme for assessing (cost-benefit analysis) tax expenditure 

4) Policy Development

  • Supporting and actively guiding the establishment of a tax policy partnership forum bringing together key actors in tax policy (i.e. MEF, AT, among others, including CS and for instance gender and social inclusion organisations) at a political and technical level; 
  • Developing appropriate policy analysis capabilities, designing/drafting, supporting new tax policy issues that may arise and/or supporting the implementation of specific study recommendations (in line with the potential medium-term tax policy strategy).
  • Suggesting and supporting the development of specific legislation addressing reforms to certain taxes based on the evidence generated in component 1, the policy objectives of the GoM and input from different stakeholders (e.g. in the private sector).
  • Supporting the development of a medium-term tax policy strategy based on tax policy partnership;
  • Supporting the MEF in setting appropriate targets for a tax reform (beyond the level of tax revenues collected).

5) Building cross-cutting capacities

  • Developing and delivering training modules, as required, to support the long-term capacity development of the DNPED, in line with the Tax Policy Strategy and capacity building plan, such as:
    • Formal training courses on tax policy analysis and forecasting and mentoring of technical staff in their day-to-day use;
    • Developing and providing opportunities for regional networking events / peer support, class sharing, whenever possible;
    • Advanced excel training.

Additionally, the National Expert is expected to provide input into the following activities, under the guidance of the International Expert:

  • Supporting the design and delivery of the activities as listed above;
  • Providing ongoing advice on how Mozambique can address gaps and/or weaknesses in tax policy from both a policy and legislative perspective;
  • Speedily assessing and responding to requests for technical information from the DEPD in the MD;
  • Carrying out all activities relevant to building the capacity of the DEPD and/or actively supporting capacity building initiatives;
  • Working closely with other team members to ensure the development of a tax policy that both reflects the reality of the tax administration and guarantees equity and social inclusion;
  • Cooperating with other programme experts/donors to ensure a coordinated and harmonised approach to programme delivery, in particular the Tax Working Group, the World Bank and IMF;
  • In the course of the Consultant's work, providing DEPD staff with up-to-date knowledge on the latest research and studies where relevant;
  • Providing input for monthly and quarterly reports to the FCDO and the MEF as required/requested;
  • Any other requirements related to the project identified by the Project Director, the DEPD Director, the International Specialist or the TEDI team leader.

Time limits and work stages

A detailed work plan will be developed in collaboration with the MEF and the specialists to establish the sequencing of the above activities.

As a general guideline, the MEF foresees:

  1. An initial phase focused mainly on the development of studies and analyses, laying the foundations for a comprehensive reform of tax policy;
  2. Development of a coherent tax reform strategy based on the outcomes of the above item and consultations within the GoM and other stakeholders;
  3. Preparation of legal instruments providing the legal basis for the reforms [3];
  4. Continued focus since the launch of the project and during its life on training, capacity building and development of tools for analysis, revenue forecasting, tax expenditures and other relevant matters.

Deliverables

Key performance indicators (KPIs) shall be agreed with the Specialist as soon as his/her work plan is completed.

JOB REQUIREMENTS

Key skills and expertise

  • A Master's degree or (preferably) a PhD in economics or a similar field;
  • 5-10 years’ experience working in Economic Policy, Public Finance Management, Tax/Tax Reform or other relevant areas in Mozambique;
  • A sound understanding of the macroeconomic situation in Mozambique; a specific understanding of tax policy and the tax system would be valued;
  • Autonomous, dynamic, capable of identifying opportunities and developing them;
  • Experience in developing the technical capacity of counterparts, including strong mentoring/coaching/training skills, where sustainable transfer of knowledge and skills is a priority;
  • Strong interpersonal skills, with the ability to build effective relationships with peers and colleagues from a wide range of professional and cultural backgrounds;
  • Ability to work effectively in politically sensitive and challenging environments;
  • Ability to work effectively as a team member;
  • Strong written and verbal communication skills, including fluency in English.

Reporting

The National Specialist shall report to the International Specialist and the Director of DEPD on his/her daily work. As far as the project is concerned, the national expert shall report to the TEDI project team leader.

Performance Management

The national specialist will undergo quarterly performance reviews by his/her line manager and TEDI project manager.  Information will be collected from the rest of the team at DEPD, including the Director of DEPD and government staff assigned to the project. Performance reports will be shared with the Project Director, the Project Manager and the Team Leader for joint discussion. The TEDI Programme Director will decide on the final outcome of the performance management process according to:

  • Roles and responsibilities, and required competencies;
  • The specialist's own work plan and corresponding KPIs;
  • The Specialist's display of ethical and effective communication within the team and the programme's main counterparts (MEF and FCDO)

Place of Work

The National Tax Policy Specialist will be based in Maputo and will work at the MEF premises.

Level of Effort / Duration

This is a full-time position, equivalent to 220 days a year.

APPLICATION PROCESS

Candidates are encouraged to apply as soon as possible.

For your application to be considered, please upload your documents as followed: Candidate name - Title of the Position.

We thank all applicants, however only those shortlisted will be contacted.


[1] Source: GPECI – DPAR, GDP at current prices at current prices of MT 1,021,028 million  

[2] ICTD/UNU-WIDER (2019), Government Revenue Dataset,  https://www.wider.unu.edu/project/government-revenue-dataset

[3] It should be noted that the deputy team leader of the project is an experienced Mozambican lawyer specialising in tax policy and as such will be available for legal drafting work - the international specialist does not therefore need to be able to draft legal instruments, but will have to provide the technical inputs.


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