The Deputy Commissioner General for Technical Services of the Liberia Revenue Authority (LRA), Gabriel Montgomery, has proposed there need to revisit incentive policies and monitoring frameworks to safeguard the country’s revenues
In his presentation during the commencement of the budget hearing on Tuesday, he said each year, more than US$300 million is lost to tax waivers and incentive programs.
“We believe that incentives can be good if they are targeted towards investment and growth promotion, and that specific requirements for qualification such as local content requirements, and employment are met.,” he advised.
“As we all know, Mr. Chairman, domestic revenue mobilization is the lifeblood of our country’s development. As donor support is drying up, we will continue to increase our reliance on the LRA to meet even more ambitious targets,” Montgomery stated.
Montgomery made the remake at the Joint Budget Committee’s start of the revenue component of the 2023 budget which began with the Ministry of Finance and Development Planning, LRA and the National Port Authority.
The Joint Budget Committee comprises of Committees on Ways, Means and Development Planning and the Public Accounts & Expenditure from the House of Representatives and Senate and chaired by Representative Thomas P. Fallah who said they are poised to implement their constitutional mandate to review the National Development envelope.
He then urged his colleagues to “look into” the President’s proposal by allocating US$6 million to increase the over 15,000 civil servants’ salary who are said to be making below US$150 in minimum wage.
He explained that the 2023 Draft National Budget will begin with the revenue component which will be done in close door while the Expenditure Hearing will be opened to the pubic in the Joint Chamber of the Legislature.
Meanwhile, the Deputy Finance Minister for Fiscal Affairs, Samora P. Z. Wolokolie, said the total resource envelope for Fiscal Year 2023 is US$777,943,212.50 and of this amount, 16% or LD 20.1 billion is domestic currency, and $656.6 million or 84% is actual United States dollars at the projected exchange rate by the Central Bank of Liberia is US$1:165.31.
Wolokollie said the total projected revenue from Domestic Resource Mobilization is US$667.9 million or 86%, while External Resources account for US$110 million or 14% and that revenue assumptions are supported by the following macro-economic and tax policy assumptions:
“Real GDP in dollar terms for 2022 is estimated at US$3.51 billion and is expected to reach US$4.9 billion in 2023. The statistics speak to the good health of the economy under our stewardship,” he told the committee.
For FY2023, there are no new tax policy measures underpinning this budget, however, we intend to further strengthen current tax policies that are already in effect and to present a draft amendment to the revenue code to replace the goods and services tax (GST) with Value Added Tax (VAT) as well as other amendments to strengthen tax administration.” Deputy Minister stated.
Meanwhile, today will bring together six Agencies and they include, Liberia Telecommunication Authority (LTA), Ministry of Mines and Energy, Ministry of Transport (MOT), Ministry of Justice, The Liberian National Police and the Liberia Immigration Services (LIS).
