Madagascar’s tax revenue performance showed encouraging growth during the first four months of 2026, although collections remained slightly below initial forecasts. According to figures released by the Ministry of Economy and Finance, the General Directorate of Taxes (DGI) collected Ariary 1.744 trillion in gross tax revenues between January and April 2026, generating Ariary 1.668 trillion in net revenue for the State budget.
This result represents an 8% increase compared with the same period in 2025, reflecting a positive trend in domestic revenue mobilization. The growth was mainly driven by key taxes, including Value Added Tax (VAT), Excise Duties, Payroll and Salary Income Tax (IRSA), Tax on Investment Income (IRCM), and Corporate and Personal Income Taxes.
Despite this progress, revenue collection fell short of the targets established for the period. The execution rate reached 91.04% of the expected revenue for the first four months of the year, leaving a shortfall of approximately Ariary 171.8 billion. According to the Ministry of Finance, most tax categories recorded lower-than-expected collections, contributing to the gap between actual and projected revenues.
Nevertheless, the government has decided not to revise its annual revenue objective downward. Under the 2026 Revised Finance Law (LFR), the DGI’s annual domestic tax revenue target remains unchanged at Ariary 6.222 trillion, in line with the original Finance Law. This objective corresponds to a gross tax pressure ratio of 6.21% of Gross Domestic Product (GDP), which could increase to 6.29% following updated macroeconomic projections included in the revised budget framework.
Looking ahead, tax authorities expect a steady increase in domestic revenue collection. DGI projections estimate tax revenues will reach Ariary 6.872 trillion in 2027 before rising to Ariary 9.316 trillion by 2028. If achieved, these figures would contribute to a significant improvement in the national tax-to-GDP ratio, which is projected to reach 7.33% by 2028.
At a time when public investment, infrastructure development, and social programs require substantial financing, maintaining this ambitious target reflects the government’s confidence in the tax administration’s ability to strengthen tax collection mechanisms and broaden the tax base. The coming months will be crucial in determining whether the DGI can close the current revenue gap and achieve its fiscal objectives for 2026.
