IMF-WBG Background Paper for G-7: Principles for Effective and Efficient Support for Domestic Resource Mobilization (DRM)

Policy Papers, April 28, 2026

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Domestic Resource Mobilization (DRM) is described as central to achieving sustainable financing for development, building fiscal buffers, and strengthening state capacity.
Recent IMF and World Bank work shows many countries—especially low-income countries (LICs) and fragile and conflict-affected states (FCSs)—are still collecting less than 15 percent of GDP in tax revenue.
World Bank and IMF research suggests that collection beyond this threshold is linked to lasting improvements in growth, public service delivery, and state capacity.
DRM is identified as central to the IMF-WBG three pillar approach to helping countries address liquidity challenges (IMF and World Bank 2024a) and is crucial for:
- building fiscal space to advance public spending for development,
- reducing reliance on volatile external financing,
- supporting jobs and growth,
- strengthening the social contract between the state and its citizens.

Emphasis on strengthening DRM, particularly in LICs and FCSs, to move tax collection beyond the identified threshold and enable durable improvements in growth and public service delivery.
Positioning DRM support as a core element of the IMF-WBG response to liquidity challenges, to create fiscal space and reduce external financing volatility.
Reinforces the role of DRM in enhancing state capacity and the social contract through improved revenue collection and public spending.