Aid, taxes and state capacity: the future of Domestic Revenue Mobilisation

As pressures on development finance intensify, domestic revenue mobilisation (DRM) has moved back to the centre of the international development agenda. The 2025 Sevilla Commitment marked an important political moment, with donors pledging to at least double support for DRM by 2030, particularly for countries seeking to raise tax-to-GDP ratios above the 15 percent threshold. Yet despite the growing recognition that effective tax systems are essential for financing the Sustainable Development Goals, building state capacity and reducing aid dependency, donor support for DRM has remained volatile and below previous international commitments.

This event explored how donors – in particular the European Union, one of the world’s largest providers of DRM assistance – can turn the Sevilla Commitment into credible and effective action. Drawing on Bruegel’s recent Policy Brief, the discussion will take stock of the current state of play in international support for DRM, examine how donor approaches and funding patterns have evolved over time, and assess what forms of DRM support have proven effective, and where important shortcomings remain. Looking ahead, the event also explored how delivery can be improved, including through stronger partnerships, better targeting of support and closer integration of DRM into broader development and investment strategies.