Miro tax collection solution.

Past and Current Partners

Katapult Impact Accelerator, Batch 4 (Norway), Visa, EcoBank.

Active Countries
Liberia, Senegal
Thematic area(s)
Inclusive Growth
Organisation Name
Red Flash Mobile AB

The Problem

The term 'informal sector' is used to describe employment or livelihood generation primarily within the developing world. Most workers in the informal sector do not have employment security, work security or social security. The most prevalent types of work in the informal economy are home-based workers and street vendors. Estimates show that the non-agricultural employment share of the informal workforce is 78% in Africa. In all developing countries, self-employment comprises a greater share of informal employment than wage employment. Self-employment represents 70% of informal employment in Sub-Saharan. The informal economy has a significant job and income generation potential. Studies in West Africa has shown that the informal sector adds up to 53% of GDP but it only contributes around 3% of all taxes collected. The untapped economic potential of this sector is huge.

The Solution

SMARTR Tax is a cloud based digital platform for the collection of micro taxes and for the formalization of the informal sector. SMARTR aims to increase tax revenue for municipalities and townships, so they can get more resources for local development without dependence on central funds. With better data about the informal sector, SMART aims to help the government improving the quality of planning and decision making. For merchants, all their payment records are stored digitally which creates traceability and trust. Ultimately, the digitization of the informal sector and payments will provide a foundation for additional Govtech services such as social insurance, social disbursements (cash transfers), and micro credits.

How it works?

  • Step 1: Implementing the geographical borders of the municipality, as well as the tax regime and business classification scheme in the platform.
  • Step 2: Training local tax agents in the use of the system.
  • Step 3: Hosting information meetings with key leaders from the underserved sector along with information campaigns via leaflets and radio spots.
  • Step 4: The agents go out in the sector and start registering merchants on the SMARTR Tax app. All relevant data is collected and geo-tagged. When registering merchants business licenses are issued and taxes are collected. Mobile Money payments are initiated via the SMARTR Tax app. Those who do not have funds available at the moment can pay via USSD. The app can be used for following up on payments and enforcement.
  • Step 5: Statistics and operational data are published on a log-in-protected page. Weekly and monthly performance and sales reports are automatically sent out to key stakeholders.
Digital X Solution SMARTR Tax

Bridging the digital divide

Via a program in Senegal with VISA and Ecobank, intended to onboard 35 000 women to the digital payment platform Ellevate. This allows them to bring additional services such as micro-insurance, microcredits, and social cash transfers. It allows municipalities to have a fully digitized tax base, using digital payment solutions for tax payments.

Impact and highlights

Registered 18, 000 merchants in ten municipalities (Senegal) increasing the tax revenue by more than 100%. 1,900 registered merchants in four municipalities (Liberia).

Plans for expansion

Currently working with Monze, Choma & Kalomo in Uganda. As well as Finance Pro. in the following municipalities: KIRA MUNICIPALITY & NANSANA MUNICIPALITY, WAKISO DISTRICT MBARARA CITY, HOIMA CITY