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Sierra Leone News: SOEs urged on tax compliance

The Commissioner General of the National Revenue Authority (NRA), Samuel Jibao, has urged State-Owned-Enterprises (SOEs) to ensure that their business operations meet their fiscal obligations to ensure Government gets the required funding to continue doing business. This, he said, will also go a long way in helping deliver the country’s medium-term aspirations and to significantly reduce reliance on foreign aid. Organizations that fall into the category of State-Owned-Enterprises include: the Maritime Administration, Correctional Centre, SLRSA, University of Sierra Leone, Limkokwing, Rokel Bank and others. Jibao was speaking on Tuesday 2 October 2018 at the tax education workshop held for SOEs, hosted by National Revenue Authority (NRA) at the Bangura Building on Wellington Street, Freetown.  “Let us do this things together as enforcement is part of us, some people are defaulting not because they want to default, maybe some accountant may not be au fait with the country’s tax law,” he said. CG Jibao said that some people may say they have problems with their cash flow, so they pay salaries with the monies meant for pay-as-you-earn (PAYE) money. He told the participants that as part of the Public Financial Management Act everyone should be brought on board. The workshop, he said, is to understand their challenges and see how they can engage with the Ministry of Finance and other stakeholders, but cautioned them that it is not good for them to be left out of the process. The SOEs should be identified in terms of their liabilities, as currently auditing is on going in almost all the SOEs. He appealed to them to comply so that they will be able to establish what their true liabilities are. “There are so many ways as tax administrators we will be able to look at the liabilities again and ensure that we make it much easier for you to pay, because our assignment also is to ensure that the compliance cost is low,” he said. “Anything we can do for you administration wise, please tell us, on the policy aspect we can take it up with MoF so that we will develop this country with our own resources, please open your books to us establish liabilities.” Commissioner Domestic Tax Department (DTD), Ibrahim Sorie Kamara, stressed that the Authority is now putting extra energy into the whole revenue collection activity because 100% of what government needs at this time is generated by them, which means that they are not getting any funds from anywhere at the moment. The NRA, he said, has got this additional responsibility as the revenue they generate used to be between 65 to 70% of the total budget financed by domestic revenue and the balance 30% comes in the form of donor support. “If we are not able to fill this gap now it will be a very serious problem. Government will not be able to support the free education program. The health and infrastructural sector all has its own challenges, so the expectation is very high and the people of Sierra Leone would not understand if government give excuses for not delivering,” he said. As a Revenue Authority charged with this sole responsibility they have to reengineer their processes. They have to make sure that they tap into areas that they have not been getting support from and one of these key areas that we are now penetrating into is the SOEs. “We are here to remind you of your obligations. We all know that the law is clear on taxes, and exemptions and that you are important because whatever we collect some of it is then allocated to you to keep your operations going,” he said. Unfortunately, Commissioner Kamara said that they have got situations where the SOEs have not been complaint. They hardly file their GST or Income Tax returns or Withholding Taxes. He went on to say that if they withhold these taxes they hardly pay back on the pretext that the Finance Ministry did not give them sufficient allocation. “You are making us look very bad. Most of your activities are taxable ones you are not-for-profit-making that does not mean you should not meet your compliance requirements for taxation purposes,” he warned. Manager Taxpayer Services at DTD, Aminata Iyamide Kamara, took the participants through obligations, penalties, enforcement, changes in the Finance Act 2018 and tax clearance certificates. The importance of revenue collection, she said, is very important to the SOEs, as most of the big contracts are being issued by them and it is the duty of the NRA to make sure that they understand their obligation. “We want you to comply voluntarily and contribute towards revenue generating processes,” she said.

ZJ/3/10/18

By Zainab Iyamide Joaque

Thursday October 04, 2018.

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