During the April 2025 Tax Stamp & Traceability Forum™, Linstrom Marangu, Health Tax Specialist from the African Tax Administration Forum (ATAF), chaired a panel discussion on the need to integrate excise systems into an overarching tax administration platform.
Joining Linstrom on the panel were Ambar Ootim, Mauritius Revenue Authority; Michael Gyasi, Ghana Revenue Authority; Caxton Ngeywo, tax administration expert, formerly of Kenya Revenue Authority; and Francisco Mandiola, security solutions expert, formerly of the Chilean Mint.
This article presents some key parts of the discussion, starting with an opening remark from the chairman.
Linstrom Marangu (LM): There are several reports – including the ATAF African Tax Outlook and the OECD’s ‘Tax Administration 3.0’ – which set out a vision for the digital transformation of tax administration into a seamless and frictionless process. In this vision, the silos in which different tax and customs systems currently operate, are broken down, enabling the integration of these systems into a unified, interoperable framework.
Linstrom Marangu.
But what does this mean for excise tax systems?
Caxton Ngeywo (CN): It is true that global tax reforms have largely left excise tax systems behind, to the extent that they are either not automated or are in the process of becoming so. Furthermore, authorities are not very experienced in utilising data emanating from excise processes. This is unfortunate, because these processes generate critical data on the production, import, distribution and sale of high-revenue, high-risk excisable goods, as well as on the taxpaying entities involved in those goods.
Integrating excise data with other tax and customs processes would allow data to be crosschecked across multiple systems to create a holistic solution for compliance monitoring.
Ideally, such integration would cover three major areas:
1.Customs declarations and accounting data need to flow directly into excise. This is critical when accounting for the production of excisable goods, because the raw materials needed to produce those goods are often imported.
2. Excise information should flow into direct tax and other consumption tax systems, as it can be used to determine the level of these other taxes. Tax stamp and traceability systems, in particular, have a positive impact on VAT and income taxes, as well as excise.
3. Non-tax-related government institutions also have an interest in data from excise systems, because excise taxes typically apply to products that are sensitive, regulated, or have public policy implications. For example, public health agencies may use excise data to monitor usage trends and evaluate the effectiveness of health policies.
And law enforcement agencies can use traceability data to detect smuggling, counterfeiting, and tax evasion practices.
LM: Ambar, you are in charge of the excise unit at the Mauritius Revenue Authority. Mauritius has a tax stamp system in place, and I’d like to ask how integrated this system is with other processes?
Ambar Ootim (AO): In Mauritius, the revenue authority is in charge of income tax, VAT, customs and excise. We have two separate systems: one for income tax and VAT and one for customs and excise. However, all employees, in each tax office, have access to both systems, which greatly facilitates fraud detection and issues relating to tax evasion.
Ambar Ootim.
LM: Michael, in Ghana the health tax policy has proved very efficient, resulting in significant revenue growth, despite a drop in tobacco consumption. Could you describe what systems are currently used by Ghana Revenue Authority and to what extent they have been integrated.
Michael Gyasi (MG): We have a single window type of integration, called Ghana Integrated Tax Management and Information System (GITMIS) which consolidates various tax functionalities into one interoperable system, including income, VAT, excise, and withholding tax. GITMIS also integrates with other government systems, including the Ghana Card database, banking systems, and customs.
Michael Gyasi.
Our tax stamp programme is fully integrated into GITMIS, which acts as central repository for the taxpayer ID numbers needed by manufacturers and importers to obtain tax stamps. In addition, all actions pertaining to stamp issuance and affixing, inventory flow, returns, and enforcement are electronically fed into GITMIS. This allows the platform’s compliance analytics engine to automatically flag anomalies, prioritise audits, and support interagency investigations.
The integration of ‘stamp-to-seizure’ excise data into other tax functionalities allows this data to enrich taxpayer profiles, financial transactions, audits, and national tax analytics.
LM: Francisco, I know Chile also has a tax stamp and traceability system in place. Could you describe to what extent this has been integrated into a wider tax administration platform.
Francisco Mandiola (FM): While Chile’s tax and customs authorities cooperate on excise enforcement, full integration between the two is limited, particularly regarding access to granular traceability data from the tax stamp and traceability system, which is managed by the tax authority (SII).
So, while SII retains full access to stamp issuance and affixing data, serial numbers, production/import logs, and distribution chains, the customs authority is essentially restricted to stamp validation at the border, and basic verification of declared shipments against tax stamp issuance logs.
Furthermore, as far as Chile’s overall tax administration system is concerned, excise tax traceability remains siloed, away from VAT, income, and other taxes, which, themselves, are fully integrated into a unified digital platform.
Francisco Mandiola.
LM: Caxton, in your former role at Kenya Revenue Authority, you had extensive experience with the country’s excisable goods management system (EGMS), which has been integrated with customs. Can you tell us more about this, as well as the integration taking place at regional level between the countries of East Africa.
CN: I think it’s relevant here to speak about a real-life problem we had in Kenya which accelerated the adoption of an integrated platform for integrating customs with the tax stamp programme. Prior to integration, data was moving from one system to another through a process which was decidedly ‘unseamless’, and which ultimately led to data being corrupted.
For example, people applying for stamps in relation to imported goods were required to provide evidence of these imports, which they did in the form of paper-based declarations. But it was often discovered that either the import had not actually taken place – and the people just wanted the stamps – or that it had taken place, but the import details had been altered to show a different product description or quantity.
So, it became a matter of urgency to integrate the import declaration process into the tax stamp management programme to ensure the overall integrity of the system.
In addition to this, there was a strong drive in Kenya towards ensuring that information from the EGMS fed directly into the revenue authority’s tax reporting and accountability system, which had been developed separately.
To this end, it was decided to enhance the EGMS so it could record the point at which goods left the manufacturer’s premises (or bonded warehouse) for delivery to the first buyer – given that it was at this point that excise duties became due. This information was then fed into the tax accounting system for the invoicing process.
Then, with regard to the integration of systems across the East African region, this arose as a result of widespread roundtripping in the region, especially involving cigarettes, alcohol, sugar, and fuel. It was decided that each country’s customs, border management, tracking, and tax accountability systems should be integrated as far as possible, to allow one country to access the details of goods coming in from another country.
There is even a project currently underway in East Africa to allow exporting countries to mark products and capture information directly into the system of the country they are exporting to.
LM: We know we need to integrate, but why are we not doing it? What are the challenges?
FM: What I think is a top issue is a lack of political will. Without this, there will never be a successful integration.
Integrating excise systems into an overall tax administration platform also depends on how much revenue a country is making from excise. If excise makes up a very small part of a country’s income, there may not be much incentive to integrate it with other systems.
In addition, not all owners of individual silos within a government administration are in favour of integration, as this entails sharing information, which for some owners means a loss of power.
Another challenge is that public servants are often politically nominated, which means their jobs don’t last beyond the current administration. So, it’s very unlikely that they’re going to risk their benefits or influence to help the next administration.
In this case, the best way to integrate systems would be to make sure that public servants are professionally categorised, hired based on their qualifications, and maintained in their position as a result of good performance, independently of government or political changes.
MG: There are legal, regulatory and trust challenges related to integration. For example, in Nigeria, the tax and customs agencies operate under different legal frameworks, which makes it difficult for them to integrate.
Institutions that are responsible for data and systems may believe they cannot exchange information beyond their jurisdiction because they have a mandate to run a certain function, and the people asking for information are either from other institutions or from other governments, and the data-sharing laws in some jurisdictions are very prohibitive. So, we need to have laws in place that allow for the exchange of information under certain circumstances, and for specific types of information.
And there are, of course, technical hindrances, especially in Africa. For instance, the internet penetration in Liberia is below 40%. A delegation from Liberia recently visited Ghana to see our tax stamp administration system, but with such a low internet reach, they would have had to resort to paper filing and other outdated methods, so how could integration even be possible in such a situation?
In addition, many systems currently in place are essentially built as single, rigid monoliths that require extensive resources to break down and rebuild into an integrated platform.
LM: What do we need to do to address integration challenges?
MG: One action that governments need to take is to build integration into service provider contracts during the procurement process. Otherwise, providers will consider any subsequent request for integration as additional work, against which they’ll charge additional fees.
In any case, technology providers may be reluctant to engage in system integration as this requires them to disclose their APIs (specifications for allowing different software systems to interact with each other), which they believe would expose their technology secrets.
Therefore, both governments and providers need to be able to see what the future of technology looks like, and to appreciate and plan systems in such a way that they address not only the challenges of today but also the digital transformation of tomorrow. This involves capacity building, and the valuable work undertaken by organisations such as the ATAF and World Bank in getting our governments and technology providers to start seeing the future.
LM: Ambar, from your perspective, what can system providers do to help your administration advance towards integration?
AO: I think it is crucial for suppliers to share their knowledge and expertise with governments and be ready to support them through the integration process, because a key reason why governments do not move forward with integration is that they don’t know how to. In addition, there is a cost issue related to integration, which a public-private partnership, between supplier and government, might be able to resolve.
LM: In closing, I would say that, on the path to integration, it is important for technology providers to consider how best they can support governments in their transformation efforts, because, clearly, operating in silos is not effective. In turn, government representatives should ensure that integration requirements are taken into account in contracts with service providers, so that specific system developments can already be aligned with a broader vision for interoperability.
