• Togo tax-to-GDP ratio at 13.1%, below regional 20% target

• New 2027–2029 budget framework aims to improve fiscal planning

• Government seeks higher revenue via tax base expansion, digitization

Togo's tax-to-GDP ratio stood at 13.1% of GDP in 2025, well below the 20% threshold set by the regional economic community. The figure comes as the country launched its medium-term budget framework, known by its French acronym CBMT, covering the 2027-2029 period.

The exercise is designed to strengthen public finance planning by projecting revenue, spending, deficits and debt trajectories over three years.

"Unlike the annual budget, which sets allocations for a single fiscal year, the CBMT offers a strategic vision and ensures intertemporal coherence between our public policies and the financial resources available to implement them," said Akou Mawussé Afidenyigba, chief of staff at the Ministry of Finance and Budget, who represented the finance minister at the launch. "Concretely, it is a decision-support tool that simulates debt and deficit trajectories under various scenarios, determines levels of public investment compatible with fiscal sustainability, and identifies the funding allocations needed to implement our development priorities, particularly those outlined in the 2026-2031 roadmap."

Boosting Revenue

The country is counting on economic growth estimated at 6.2% in 2025, with inflation contained at 0.4%. Fiscal space remains limited, however, largely due to debt servicing costs, which are constraining public investment capacity.

Against that backdrop, authorities have identified several measures to boost revenue. Broadening the tax base, by tapping new revenue sources without raising taxes, and digitizing public administration are expected to improve revenue collection. Containing spending, particularly the wage bill, which accounts for around 7% of GDP, remains a key challenge to avoid budget rigidity.

Public investment in the West African country is holding steady at around 6.6% of GDP, equivalent to approximately 458 billion CFA francs. The challenge is to channel those resources toward high-impact projects capable of supporting growth and employment.

With the international environment marked by rising tensions and shrinking external aid, Togo is seeking to preserve its macroeconomic credibility, in part by improving tax performance, building on efforts already underway. Revenue mobilization has posted steady gains in recent years, driven by the performance of the Togolese Revenue Authority, known by its French acronym OTR.

Tax and customs revenue reached 990.1 billion CFA francs in 2023, a 14.5% increase year-on-year that exceeded projections. The momentum held in 2024, with 1.098 trillion CFA francs collected, crossing the one-trillion-franc threshold for the first time.

Policy Priorities

The budget framework through 2029 rests on three priorities: security and stability, including strengthened defense capacity and social safety nets; national cohesion, through decentralization and reducing inequality; and economic transformation, through targeted investment in infrastructure, agriculture, logistics and digital technology.

Authorities also plan to impose strict project selection criteria. Under the framework, investments must be included in the 2027-2029 program, subject to sound technical studies and identified financing sources, according to the ministry responsible for the budget.

R.E.D.