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Sierra Leone Business: 2018 budget – No New Taxes

Finance Minister, Momodu Kargbo, has said in Parliament while delivering the 2018 budget speech, that there will be “no new taxes.”
Presenting the Appropriation Act 2018 to Members of Parliament on Friday 27 October he said “The 2018 budget will seek to raise revenue without introducing any new tax. It would also not raise any tax rate in any category.”
Dressed in dark African attire, the Finance Minister maintained the emphasis would be placed on strengthening tax administration including enforcing compliance, closing loop holes and reducing duty and tax exemptions.
This pronouncement attracted loud applause from MP’s and members of the public listening from the gallery.
He informed the gathering that the 2018 budget in the medium term seeks to make growth more inclusive and sustainable through sound fiscal framework with room for expanding infrastructure, social security and structural reforms to encourage private sector participation.
“The projected growth rate of 5.6 percent of the economy will be supported by increasing public investment on road, energy, agriculture. Education, health as well as spending on social safety net programs” he said.
He furthered that domestic revenue is projected at Le 4.56 trillion or 13.3 percent of the Gross Domestic Product (GDP) for 2018 as compared to Le 3.25 trillion or 12.1 percent of the GDP for 2017.
He disclosed that the measures his Ministry will take to improve domestic revenue mobilization for 2018 will focus on strengthening revenue administration with the aim of expanding the registration of tax payers, enforcement of payment of taxes by professionals, enforcement of payment of withholding taxes of rental properties.
According to him they will also strengthen the capacity of NRA to undertake specialized auditing of large firms in telecommunications, mining, banking and commerce, automation of tax administration processes and improving goods and services tax administration and compliance.
Minister Kargbo earlier disclosed the country’s economy was on a positive trajectory recording impressive growth performance with a stable macro economic environment over the past decade but external shocks, fall in commodity prices and natural disasters, (Ebola and mudslide) have at the same time undermined the economic ability to sustain its growth.
“Lessons from the combined effects and external shocks and the landslide have underscored the need to strengthen resilience of the country’s economy” he said.
He explained the implementation of prudent economy policies combined with the resilience of the people with support from development partners has enabled them to overcome the crisis and return to positive economic growth.
“We still need to improve road infrastructure, energy, and water supply. There is also the urgent need to provide housing for the people, continue to improve health and sanitation facilities and ensure food security” the Minister disclosed.
Speaking to the Chairman of the Committee of Finance, Honorable Hassan Sheriff, he maintained this if the first time a budget is presented to Parliament on the stipulated time.
He disclosed the basic needs of the people were addressed in the 2018 budget and it also captures the Disaster Relief Fund for extreme cases that were not included in previous budgets.
“There is also something hidden in this budget which most people are yet to notice. This budget increase salaries of civil servant which further increase the budget to something above Le 6 trillion’” He said.
On the issue of austerity Hon Sheriff said the Minister did not mention it in his presentation in Parliament because its time frame had expired long since.
The Executive Director for Heal Sierra Leone Joseph Sannoh, a Civil Society activist who witnessed the presentation, said they see such budgets year in and year out but questioned whether the budget will reflect on the lives of the ordinary man.
He said huge amounts in the budget will be allocated to administrative or other costs while less than 30 percent will be for the actual implementation, which would touch the lives of the people.
He called on the MP’s to critically assess the budget while debating and make recommendations and adjustment where necessary in the interest of the people and country.
By Alhaji M Kamara
Monday October 30, 2017.

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