Business Corruption

The business executives surveyed in the World Economic Forum Global Competitiveness Report 2010-2011 identify tax regulations among the most problematic factors for doing business in Mali. Companies should note that it is not uncommon to be expected to give bribes when meeting with tax inspectors.

According to the US Department of State 2010, the Malian tax system remains complicated in spite of ongoing efforts to improve it. Moreover, foreign investors have reported that tax collectors sometimes interpret tax laws in a discriminatory manner.

Political Corruption

Tax evasion is widespread and results in tremendous loss of income for the state. In 2011, when the Auditor General conducted a review of its performance since its creation, it discovered that the taxation services, whilst accounting for only a quarter of the audits, were responsible for approximately 75% of the total revenue shortfall.

The discrepancies in the taxation services were initially revealed by the Auditor General's Annual Report 2006 (in French). Many ministries have been implicated in corruption, fraud and mismanagement in relation to public finances. Ironically, l'Energie du Mali (EDM-SA), a company responsible for collecting VAT for the Malian government, did not carry out its tasks properly in 2002, 2003 or 2004, resulting in a loss of more than XOF 1 billion.

Similarly, in 2007 and 2008, the Auditor General conducted investigations in several state departments, including the Department of Taxation, and a number of public servants were accused of embezzlement and economic crimes.

Frequency

The World Bank & IFC: Doing Business 2011:
- During the course of a year, a medium-sized company can expect to pay an average of 59 different taxes at a total tax rate of 52% of profits, and spend 270 hours managing the administrative tasks related to these payments.

The World Bank & IFC: Enterprise Surveys 2010:
- 26% of companies identify tax administration as a major constraint on doing business.

- 20% of companies in Mali state that they are expected to give gifts when meeting with tax inspectors. Both figures are lower than in the previous survey.

Afrobarometer: Summary of Results Mali 2008:
- 26%, 26% and 29% of the respondents in this household survey considered some, most or all of the tax officers to be corrupt.