IREED, Others Petition Legislature on Tax Reform
The Institute for Research and Democratic Development (IREDD), Liberian Business Association (LIBA), Patriotic Entrepreneurs of Liberia (PATEL), National Customs Brokers Association of Liberia (NCBAL), and the Federation of Liberian Youth (FLY) has petitioned the Legislature, calling on the Lawmakers to institute a major tax reforms in the Country.
In their petition submitted to the Legislature recently, the organizations stated a lot of constraints being faced by Liberian and other businesses as a result of the high tax rate being instituted by the Liberian Government through the Liberian Revenue Authority (LRA).
The petition which was read by Mr. Ivan Tumbey, President of the National Customs Brokers Association of Liberia, indicated that on August 15, 2017, the Institute for Research and Democratic Development, with the support of Open Society Initiative of West Africa (OSIWA), launched an advocacy campaign for Domestic Resource Mobilization through Fairer Tax Governance and Reforms.
According to Tumbey, the primary purpose of the advocacy campaign was to engender wider public discussions on the impact of the Liberia Tax Amendments Act of 2016 which imposed an additional tax burden on all taxpayers, especially Liberian owned businesses that are already challenged financially to compete with their foreign counterparts.
Accordingly, Mr. Tumbey said, the Liberia Tax Amendments Act of 2016, in effect and application, has constrained and continuous to impair the growth and development of Liberian owned business already faced with limited financial opportunities for growth and development.
He went on to say that the continued imposition of unbearable taxes on the struggling businesses without tax benefits has reduced us to mere spectators in our own economy.
“Amid the strenuous tax amendments act of 2016 and other unconventional assessment methods of trade facilitation, Liberian owned businesses led by the Patriotic Entrepreneurs of Liberia (PATEL) were constrained to stage a standup action at the Free Port of Monrovia, resisting trade facilitation with the Liberia Revenue Authority (LRA). The standup action for tax justice later resulted into the three-day shutdown of nearly all businesses across Monrovia and its environs as well as counties adjacent,” he said.
The advocacy campaign, according to Tumbey, was to gather public views or remedial measures to promote voluntary compliance with domestic resource mobilization efforts of national government.
He noted that Thursday’s assembly at the Capitol Building was intended to bring to the attention of the Lawmakers the numerous tax constraints faced by business, especially, Liberian owned businesses.
Speaking to The Monrovia Times, the Executive Director of IREDD, Harold M. Aidoo, pointed out that
“the increase in goods and service Tax (GST) by 3% from 7% to 10%, the huge bottlenecks associated with trade facilitation at the port of entries across the Country, particularly at the Free Port of Monrovia, the uncoordinated processes of LRA, BIVAC and MOCI, and APM Terminals, undefined time interval to gate out processed containers from the Port to consignees, including the undue delay of the LRA to process tax payment across the country in real time, are some of the cogent issues that are affected businesses, mainly, Liberian owned businesses”.
Also speaking at the occasion, the Chairman of the Patriotic Entrepreneurs of Liberia (PATEL), Presley Tenwah outlined several challenges, including
“the wrongful application of 4% tax on gross sales quarterly instead of annual turnover required by section 200(c)(1) of the Liberia Revenue Code, the unstable and unregulated foreign exchange rate regime, excessive penalty regime on imported used vehicles of more than 10 years, LRA continues use of administrative regulations and other unconventional methods to access customs duties on imported goods instead of CIF values(I.e. use of normal market value or selling price to reevaluate imported goods) ignoring BIVAC’s assessment regime or clean report of findings (CRF) and unrestricted system of doing business in Liberia: Foreigners serving in dual or triple capacities in the commerce of Liberia as : importer/ distributors, wholesalers and retailers at the same time leaving Liberian owned business with limited financial capacity vulnerable and as meld spectators”.
Receiving the petition on behalf of the Legislature, Nimba County Representative Roger Domah promised to transmit same to the Plenary of the House of Representatives for onward actions.