Domestic Resource Mobilization

Speeches Shim

Domestic Resource Mobilization (DRM) — the process through which countries raise and spend their own funds to provide for their people – is the long-term path to sustainable development finance. DRM not only provides governments with the funds needed to alleviate poverty and deliver public services, but is also a critical step on the path out of aid dependence.

DRM does not necessarily mean new taxes or higher tax rates. Governments often see their revenues rise though improved audits or simplified filing processes. 

Successful DRM programs are highly cost-effective; they return many times what is invested in them. One analysis showed revenue increases amounting to $20 or more for every assistance dollar invested.

USAID currently spends approximately $20 million per year on DRM assistance in over 15 countries. DRM has gained even greater importance with the launch of the Addis Tax Initiative (ATI) in July 2015 with the adoption of the Sustainable Development Goals (SDGs). As a founding member of the ATI, the U.S. government (USG) committed to substantially increase DRM spending to strengthen tax systems, mobilize public revenues, and take greater leadership in financing their own development. With an annual baseline of $26 million, the USG (USAID, U.S. Department of Treasury, and the Millennium Challenge Corporation) is already one of the largest contributors to DRM assistance of any country in the world.

DRM Resources

Collecting Taxes Database

The Collecting Taxes Database (CTD) is part of an ambitious agenda of the international community to help countries strengthen their tax systems and mobilize domestic revenue. The dataset includes comparative information on a range of tax performance and tax administration variables for close to 200 countries and territories.

Public Financial Management

To deliver the essential services needed to end extreme poverty, developing country governments must spend their resources in a transparent and accountable manner. In doing so, these governments can address the issues known to foster sustainable, broad-based economic growth, while supporting just, democratic societies. E3/EP’s Public Financial Management (PFM) staff often serves as advisors to missions to help these governments to build these skills.

Governments perform many economic functions, including developing macro-fiscal frameworks, formulating and executing budgets, and reporting to oversight institutions and the public-at-large. Progress continues to be made in recent decades, and many developing countries are improving their skills to deliver the core functions of government that affect public service delivery.

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