Over Eighty Billion Leones (Le 80,000,000,000) has been missing in the government purse for the first three quarters of the 2019 Financial Year as disclosed by the Minister of Finance, Jacob Jusu Saffa during his presentation of the 2020 Financial Year Budget in Parliament.
The Minister stated that 16.5% of the over Le 500 Billion duty waivers which is over Le 80 Billion was dished out to private investors.
“For the first three quarters of 2019 alone, revenue lost to import GST and customs duty waivers amounted to more than Le 500 billion. Of this, 40.3 percent were those granted to international organisations, 23.5 percent to donor-funded projects and 16.5 percent to private investors,” Saffa stated.
In Sierra Leone, there are two types of tax exemptions-Statutory and Discretionary Tax exemptions, the former is meant for those agencies that are protected under the Vienna Convention while the later are those exemptions which are given by discretion of the Finance Ministry.
In the SLPP Manifesto which they described as the NEW DIRECTION, excessive tax relief and exemptions were among the challenges President Bio promised to deal with.
“In 2015, government estimated to have lost Le837.4 billion (3.8% of GDP) from the 148 reliefs granted by fiscal authorities,” SLPP’s Manifesto stated.
Transparent tax system supports good governance and the accountability of policy-makers towards the public and that the granting of special tax incentives in opaque deals, as the discretion of individual ministers, without public scrutiny, undermines good governance and can increase the risk of corruption, ACTION AID maintained.
In the midst of all this, it could be recalled that in one of the Executive Orders of President Bio, he put out a moratorium on all discretionary tax waivers but it is a surprise that the Minister of Finance unequivocally stated that they are dishing out 16.5% tax waiver which is correspondingly little above 80 Billion waivers to private individuals.
Mathematically, 16.5% of over Le500 Billion that the Minister of Finance Stated is missing, is over Le 80 Billion of tax waivers dished out to private people.
IMF has just warned the government of Sierra Leone of the wellbeing of Sierra Leoneans which is less than desired while at the same time government functionaries at Finance keeping dishing tax waiver to private people.