By Ruth Yeabu Sesay
As part of efforts to promote tax compliance and increase revenue generation in Sierra Leone, the Commissioner General of the National Revenue Authority (NRA) has revealed plans of establishing a tax court to trial cases related to tax administrations.
Dr. Samuel Jibao was speaking at a high level conference on taxation and development organized by the International Centre for Tax and Development (ICTD) in partnership with Budget Advocacy Network and the NRA at the Radisson Blu Conference Centre in Freetown.
Dr. Jibao noted that taxation is one of the key components for government revenue used for the development of the country, highlighting the achievement of the Authority in tax administration and collection.
He also noted the effects of COVID 19 and the global shocks resulting from the inflation on prices of goods and services, disrupting revenue generation, adding that the GDP of the country dropped. “By September 2022, we were expecting to collect 5.5 trillion but only 5.1 trillion were collected,” he said. However, he said that the National Revenue Authority has embarked on a number of reforms to ensure compliance and revenue generation.
He underscores that he is currently championing the cause of making tax administration much easier for everyone. He also stated that tax compliance is about engagement, adding that the challenges are there but was very optimistic that they will soon achieve full compliance from the business sector.
Jibao said that the revenue court will serve as the final course of action to be taken when individuals or companies fail to abide by the law and pay their taxes.
Speaking at the opening of the conference on Wednesday 7th December 2022, the Executive Secretary of the West African Tax Administration Forum, Babatunde Oladapa emphasized integrity and transparency in tax administration, saying that “people will start paying taxes when they see integrity in the lifestyle of those who audit the tax that they collect”
He said integrity is key as it builds trust between the tax payers and those collecting taxes saying people will be assured that their money will be used for the development of the country and not for personal use.
A lady from the audience, Jeneba Kamanda said it is quite important that the taxpayers are properly sensitized about the different taxes so that they can know what they are paying for. She said that the tax administration needs to change the manner of communication because using force would not yield better results, and for a persuasive method be employed to see the change in tax payment.
In her keynote address, Dr. Yakama Manty Jones from Sierra Leone’s Ministry of Finance said that the current global crisis has affected Sierra Leone and created uncertainty, disrupted supply chains and exacerbated shortages of essential commodities, causing sharp increases in the prices of food, fuel and fertilizer.
She said that the ministry of finance is aware that mobilizing tax revenue is critical in helping the situation, although the government still benefits from aid.
She said over 60 percent of Sierra Leone’s total revenue comes from taxes and that resources enable the country to invest in education, health, build roads, and infrastructure. She said they also go toward improving the supply of clean water and energy, enhance local food production, pursue adaptation measures in response to climate change risks and expand the cash social safety nets for the most vulnerable.
She said the IMF has projected that global growth will slow from 6 percent in 2021 to 2.7 percent in 2023, whilst inflation will continue to rise.
“These developments have caused real hardship for Sierra Leoneans, affecting their livelihood and food security. The poor and vulnerable who make up the majority of our society, have been disproportionately impacted, and must be protected. That is why the theme for our proposed budget for 2023 is ‘’addressing the needs of the vulnerable in the context of multiple crises” she said.
“We have already implemented fiscal measures to mitigate the impacts of the economic situation. We have maintained the zero-import duty and goods and services tax on imported rice, deferred taxes on the importation of essential commodities and cut taxes in half on essential commodities such as cement and iron rods,” she said.
In his statement, the Executive Director of Action Aid Sierra Leone, Foday Bassie Swaray said his organization has a keen interest in progressive taxation, adding that over the years, CSOs and NGOs have brought a lot of information through research about taxation in Sierra Leone.
He noted the need to embark on more public sensitization, and increased advocacy on tax compliance and the reform of tax policies, since taxation is centred on achieving sustainable development in the country.
The two day conference which ended yesterday 8th December was hosted for the first time in Sierra Leone and had taxpayers from all walks of life, expressing their views, in light of the fact that an increase in tax will greatly affect their businesses. Tax experts, government officials, civil society activists and journalists attended the event. The conference was divided into various sessions that discussed issues such as tobacco taxation, mining revenue, among others.
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