collection by regional Governments. Modern information management systems have also been put in place. In this regard, since the beginning of 2005, a tax system that handles all taxes in a single software system known as the Standard Integrated Government Tax Administration System (SIGTAS), is being installed. Currently, SIGTAS is implemented in the Large Taxpayers’ Office (LTO) and Addis Ababa Branch offices, as well as regional FIRA offices where the system is intended to administer VAT. 382 These measures are all aimed at enhancing the integrity of the tax system by reducing corruption and leakages, enhancing tax compliance, creating reliable tax databases, improving computerisation, offering tax education, and making tax collection client-friendly. Successes arising from these measures include the following: • Revenue performance (proportion of tax to GDP) has increased from 9.7 percent in 1998/99 to 11.7 percent in 2008/09. • 80 percent of total domestic revenue was generated from tax sources in 2007/08; this was about 37.2 percent higher than the performance in 2006/07 • Tax revenue contributions to the national budget increased from 61 percent to close to 67 percent in the last 18 months; and, • Total revenue (excluding grants) increased significantly over the past decade; rising from 9.5 billion Birr in 1998/99 to 29.8 billion Birr in 2007/08. Expenditure Management 383 Ethiopia’s overall expenditure performance has been strong, especially in terms of consistently increased allocations to poverty-oriented social sectors, increased financial flows to regional states based on the need for enhanced and even development across different corners of the country, reduction in debt obligations, as well as improved efficiency in public expenditure. As envisaged in the PASDEP, in the next few years, expenditure management is expected to remain prudent, with cuts in recurrent expenditure and priority given to key social sectors such as health, education and agriculture, as well as enhanced support for infrastructure development. Priority social expenditure areas highlighted in PASDEP include food security and capacity building programmes, especially in education. Government has also managed a high level of fiscal discipline by ensuring that the deviation between the budgeted and actual deficit is kept minimal. - 159 -