By Hassan Gbassay Koroma
The Budget Advocacy Network (BAN) and the International Centre for Tax and Development (ICTD), in partnership with the National Revenue Authority (NRA), yesterday Wednesday December 7, commenced a two-day international conference on taxation.
The conference which is first of its kind in the country which was held at the Radison Blu Mammy Yoko Hotel in Freetown, targeted stakeholders in the taxation sector including the National Revenue Authority, Ministry of Finance, civil society organizations and others.
Speaking at the opening ceremony of the conference, Executive Director of Action Aid Sierra Leone, Foday Bassie Swaray said over the years, BAN and many other NGOs or civil rights organizations have generated a lot of information through research about taxation in Sierra Leone and that they have made a lot of recognition.
He said tax justice should be a central concern for everyone working for social justice and that they believe as an organization,in genuinely progressive taxation, stating that a tax system that generates official public revenue, ensuring that the revenue is fairly redistributed and focus on rebalancing economic and gender inequalities like many other countries in some regions of the world.
He said setting an ambitious agenda through the mid-term national development plan with a strong commitment to finance public service delivery, especially in education, financing will not only be required for the creation of new revenue streams but that reform of an existing revenue system should mean equality into account.
He further stated that they wanted see a system where private companies doing business in Sierra Leone pay a fair share of their taxes and that they believe it allows government to generate the needed revenue to invest more or generous once in public services like education, agricultural, health and other sectors, adding that the provision of those services can only become sustainable when they are funded from the national budget.
Also speaking, the National Revenue Authority (NRA) Commissioner-General, Dr. Samuel Jibao said the best and the most sustainable way to run the country’s economy is through domestic revenue mobilization, noting that with the multiple shocks that hit the global economy, NRA was able to make gainful revenue collection for the country.
He said in 2018, when he was appointed, he met the revenue GDP at 12.3% and by the end of 2019, the revenue GDP increased to 14.8%, but that amount reduced to 13.9% when the COVID-19 hit, noting that with a lot of measures put in place, the GDP moved from 13.9% to 15.7% until in 2022 when the Russian and Ukraine war hit very hard and that they are struggling to maintain the 15.7% that was set for the year 2022.
He said the war affected the supply side of the economy, the demand side, inflation, the exchange rate, and that all of those multiple economic fundamentals, actually affected revenue generation.
He said as of September this year, they were expected to have collected about Le5.4 trillion, but they only collected about Le5.1 trillion.
He said they have taken positive reforms over the past years that will help in tax collection including deployment of the Goods and Services Tax (GST) machines in various shops across the country and the deployment of the ASYCUDA World at the Water Quay.
Deputy Chairman of Finance Committee in Parliament, Hon.Moses Edwin, said the prevalence of government revenue is for the implementation of its programs by providing social services to its citizenry, which is why taxation is indeed important from the legislative perspective.
He said parliament plays a critical role in tax collection as stipulated in Section 110 of the 1991 Constitution of Sierra Leone.
Launching the conference open, Director of Research and Delivery Division at the Ministry of Finance, Dr. Yakama Manty Jones, said Sierra Leone like the rest of the world, has been experiencing the multiple crises brought by the COVID 19 pandemic, the ongoing war in Ukraine and intensifying threats from climate change.
She said those crises have created uncertainty, disrupted supply chains and exacerbated shortages of essential commodities, causing sharp increases in the prices of food, fuel and fertilizer that the IMF has projected that Google will slow down from 6% in 2021 to 2.7% in 2023.
She cited factors including the slowdown in China, which will affect iron ore prices which are projected to decline while inflation continues to rise, adding that those developments have caused severe hardship for civil unions affecting livelihoods and food security and the poor, and that the vulnerable who make up the majority of society have been disproportionately impacted and must be protected.
She said tax enables them to invest in education and health, build roads and infrastructure and improve the supply of clean water and energy, support agriculture and local food production and pursue adaptation measures in response to climate change with an expansive social safety net to protect the most vulnerable citizens.
“We are already implementing fiscal measures to mitigate the impact of the economic situation. We have mentioned zero import duty on goods and services tax on rice, deferred taxes on importation of essential commodities and cut on essential commodities such as cement and iron rod. Also provided classroom supplies to over 35,001 vulnerable households under the social safety net project implemented by National Commission for Social Action (NaCSA) and continues to support micro small and medium enterprises,” she said.
She said government continues to include several tax measures that will improve tax revenue and help them gather the resources to improve the health of the people and protect the environment. She further cited the plan to review taxes on harmful products like tobacco, alcohol and sweetened beverages, switching from advertising rates to specific rates that will discourage consumption and bring in new revenue.
She said they will also review taxes on vehicles and plastics, a step that will help reduce pollution and damage to the environment and also plan to regulate climate finance, including carbon credits, when plus payments and transfers deforestation and conservation to bring in revenue and promote a healthy and clean environment.