Municipalities have an obligation to provide services to communities in a fast, effective and efficient way. Nevertheless, for these services to be provided there is a need for sufficient financial resources and institutional capacity to deliver these services. It is a well-known fact that municipalities are struggling to collect revenue. There are challenges that municipalities face in terms of revenue collection. A fundamental problem exists in the municipalities’ finances, which is the gap between available financial resources and municipal expenditure needs.

The main aim of any government’s revenue collection system is to collect what is owed. Improving the collection of taxes and other revenues, increasing the amount of cash available for investment by fast-moving collections to a local government’s bank account and assuring accountability are interrelated objectives.  A proper well designed revenue collection system drives the economy forward, to a more synchronized form. A typical developing economy collects just 15 percent of GDP in taxes, compared with the 40 percent collected by a typical advanced economy.

The main aim of any government’s revenue collection system is to collect what is owed. Improving the collection of taxes and other revenues, increasing the amount of cash available for investment by fast-moving collections to a local government’s bank account and assuring accountability are interrelated objectives.  A proper well designed revenue collection system drives the economy forward, to a more synchronized form. A typical developing economy collects just 15 percent of GDP in taxes, compared with the 40 percent collected by a typical advanced economy.

I believe collecting taxes is central to a country’s capacity to finance social services such as health and education, critical infrastructure such as electricity and roads, and other public goods. The last decade has witnessed an upward application of technology in cash management. Of specific importance is the use of automated remittance processors, which can greatly shorten the time it takes to process transactions. Software systems such as the Eccensys Technologies Revenue Collection Solution can perform a wide range of collection functions, including billing, receipting, accounting and reporting.

The benefits of this revenue collection solution include:

1. An improved revenue flow;
2. Greater Interest earnings on investments;
3. Improved cash management and more accurate cash forecast ability;
4. Greater budgetary control and ability to complete projects in a timely fashion;
5. Consistent and equal treatment of taxpayers
6. Improved creditworthiness and reduction in borrowing costs; and
7. Increased compliance with local tax and revenue laws.

Another challenge revenue administrations face in many developing economies is that they operate manual paper-based recording systems. Revenue leakages are common and occur because of untimely collection, corruption and under-collection.  Complications emerge in estimating how many taxpayers are missing from their registered rolls, how many of those who are registered are inactive, and how much is actually being evaded through non-payments, corruption and ineffective billing systems.

Creating a sustainable administrative revenue system that can administer own source revenues in an easy, efficient and cost effective manner is a goal that many national and sub-national governments around the world share. Hence I express motive for the recent creation of a solution that will transform the revenue.