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Sierra Leone News: …As NRA hits over Le400bn in September BAN calls for more effort to maintain the trend

The Coordinator of Budget Advocacy Network Abu Bakarr Kamara has said in Freetown that its latest Domestic Revenue Tracking exercise has revealed that the National Revenue Authority (NRA) increased its domestic revenue collection by Le 96.74 billion from March to September 2018 hitting over Le 400 billion per month for the first time in the history of Sierra Leone. Presenting the tracking scorecard, Kamara said that for the first time, the NRA collected over Le400 billion and that if this same trend continues with an additional Le 96.74 billion every six months, NRA will likely hit the target of 20% of domestic revenue to GDP by 2023. To achieve this, Kamara said that NRA should be supported to speedily implement the proposed reforms as stated in the 2019 budget speech. Some of these reforms he said are; Automating Tax Collection Processes and Procedures, Strengthening Tax Compliance, Collection of Tax from Self-employed Professionals, Review of Duty and Tax waivers and Implementation of the Extractive Industry Revenue Act (EIRA) 2018. In addition, NRA should continue to reduce the revenue leakages and use the existing laws to enforce revenue collection. With more resources, the social sector will be adequately financed and citizens will access available and safe public services. The data used for the tracking is the published monthly statement of the Consolidated Fund which includes actual revenues and expenditures done by the Accountant General Department and published on the Ministry of Finance (MoF) Website. The ‘New Direction’ Manifesto stated that they will focus on increasing domestic revenue to GDP ratio from about 10% to 20%. This was re-echoed in President Bio’s speech during the State Opening of the 5th Parliament of the 5th Republic of Sierra Leone. This second publication by BAN looks at data for three months before President Bio’s administration and six months after (January to September 2018). The Gross Domestic Product (GDP) used is Le31,722 billion.  According to the scorecard, it shows that NRA has made impressive revenue collection from April to September hitting Le 400 billion in September 2018 for the first time. “If NRA hit their domestic revenue collection target for 2018 which is 14.3% of the GDP, which is likely based on the past 4 months trend, they will need to collect additional 1.2% of GDP annually in the subsequent years to hit the 20% target by 2023” Kamara noted. Using the projected nominal GDP figure for 2021 excluding iron ore, Sierra Leone should collect more than Le832 billion per month starting 2021 to hit the 20% of GDP target by 2023. This amount Kamara said is more than twice what NRA collected in September 2018. Domestic revenue collection per day shows that the average daily domestic revenue collection rose from Le 16.27billion in March to Le20.24billion in September 2018. Income tax increased from Le124.67billion in March 2018 to Le170.41billion in September 2018. Revenue collected from Customs and Excise increased by more than two-fold from March to September 2018. GST also increased from Le54.74billion in March to Le80.30billion in September 2018. “The impressive increases in revenue mobilization could be attributed to the successful implementation of the Government Executive Orders released in April 2018 relating to revenue mobilization and closing of leakages” Kamara noted. Mineral resources decreased by two-fold from March to September 2018, with other departments and petroleum product excise duty increased by two-fold from March to September 2018. Overall, monthly domestic revenue collection increased byLe96.74billion from March to September 2018. Kamara revealed that the methodology used in the first edition to calculate the average daily revenue collection has changed. In this second edition, they used the monthly revenue collected, divided by the total working days in the month excluding weekends and public holidays. Kamara said that from April to September 2018, government has consistently spent within its revenue collected and this shows prudent financial management. Expenditure on wages, salaries and employee benefit increased slightly from Le 160.44 billion in March to Le 163.56 billion in September 2018.This slight increase BAN said could be attributed to the establishment of new Ministries, Departments and or Agencies.  Also, non-salary, non interest recurrent expenditure increased from Le131.89 billion in March to Le 165.45 billion in September 2018 and domestic development expenditure decreased from Le 44.82 billion in March 2018 to Le 7.01 billion in September 2018. The Budget Advocacy Network (BAN) is a Network of Civil Society Organisations in Sierra Leone committed to work on budgets and budget policies to enhance policy making and implementation for sustainable and equitable development. BAN was established in 2006. BAN consists of local and international organizations such as the Campaign for Good Governance (CGG), Network Movement for Justice and Development. (NMJD), Western Area Budget Education Network (WABEAN), Action Aid Sierra Leone (AASL), Search for Common Ground (SFCG), Christian Aid (CA) and Transparency International (TISL).

By Zainab Iyamide Joaque

Friday November 30, 2018.

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