USAID Domestic Resource Mobilization Project Third Annual Work Plan October 2018 – September 2019

The project is a five-year initiative funded by the United States Agency for International Development (USAID) and implemented by DAI Global, LLC. The project's goals are to contribute to the Government of El Salvador's (GOES) effort to achieve a tax revenue increase of 2% of Gross Domestic Product (GDP) over the baseline established at the end of 2017, which was 17.8%. The project also aims to implement a Result-Oriented budget formulation, improve public expenditure management, increase fiscal transparency, and strengthen public-private dialogue. The project is divided into four components: Budget Planning and Preparation Improved, Budget Execution Improved, Tax Policy and Administration Improved, and Transparency and Public-Private Dialogue on Fiscal Policy Strengthened. Component 1 focuses on supporting the development and implementation of medium-term frameworks, including fiscal, spending, and institutional frameworks, as well as supporting the implementation of a Result-Oriented Budget, including a Gender Responsive Budget. The medium-term frameworks will provide the Government with fiscal targets, data, and instruments that will guide the budget ceiling, key budget programs, and resource allocations. Component 2 focuses on supporting the improvement of cash management practices of the GOES, including the implementation of a Treasury Single Account, budget commitment installment, and a new cash projection tool. The project also aims to support the implementation of the International Public Sector Accounting Standards and the development and implementation of the second version of the Integrated Financial Management System (Treasury, Government Accounting, Public Investment, and Budget Monitoring and Evaluation Subsystems). Component 3 focuses on supporting the improvement of tax policy and administration, including the development of a state-of-the-art Government Financial Information System and the enhancement of fiscal transparency. The project also aims to support the implementation of a fully transactional e-procurement system. Component 4 focuses on strengthening transparency and public-private dialogue on fiscal policy, including the development of a fiscal policy and expenditure management program. The project aims to support the GOES in implementing reforms that will generate an increase in tax collection and improve public financial management practices. The project's activities for FY 2019 are critical to maintaining continuity of previous USAID technical support provided to the MOF, implementing new reforms, and ensuring achievement and sustainability of the project's goals. The project has organized its work to implement the Domestic Resource Mobilization Project and achieve the expected results, with a focus on supporting the GOES in implementing reforms that will generate an increase in tax collection and improve public financial management practices. The project's expected results include a tax revenue increase of 2% of GDP over the baseline established at the end of 2017, a Result-Oriented budget formulation in place, an improved public expenditure management, an increased fiscal transparency, and a strengthened public-private dialogue. The project's activities will be implemented in collaboration with the MOF and key ministries, including the Ministries of Health and Education, to ensure proper implementation of the budget reform. The project's budget planning and preparation improved component will focus on supporting the development and implementation of medium-term frameworks, including fiscal, spending, and institutional frameworks, as well as supporting the implementation of a Result-Oriented Budget, including a Gender Responsive Budget. The project will work with the MOF and key ministries to ensure proper implementation of the budget reform.