Monrovia - The Liberia Business Association (LIBA) has condemned the Government of Liberia for levying new taxes on imported alcoholic beverages, other commodities and imposition of additional tariff on phone calls in the country.
LIBA is the umbrella organization responsible to advocate and seek the interest of Liberian owned businesses.
“We categorically condemn the Government for levying new taxes on goods and services,” LIBA President, D. Maxwell Saah Kemayah said when he addressed a news conference in Monrovia Friday.
President Sirleaf recently submitted the 2016 Tax Amendment Act aimed at addressing Government’s economic and financial crisis.
But while the government sees the new taxation as austerity measure to support its current budget, many Liberians including entrepreneurs are complaining about the additional constrain it would cause for the already ‘messy’ economy.
In the first quarter (past six months) of the 2016/2017 fiscal periods, the Government has only been able to raise US$159million out of US$600million budget.
The government now faces a daunting challenge of raising over US$400million in order to meet up with the 2016/2017 fiscal timeline.
The latest tax increment on imported goods and commodities, including one cent tax levy on each one minute GSM Call is said to be a backup for the government to mitigate its prevailing economic and financial miseries.
The new tax levies on goods seem to be already affecting almost all of the local business sectors in the country as the bill awaits the President’s signature to become a law for all Liberians to obey.
However, LIBA’s Kemayah described the new tax levies as bad precedent for Liberian businesses.
He argues that Liberians are already suffering and trying to overcome the already hardship created by government, saying “Liberians are currently benefiting three days free calls provided by GSM companies and government is trying to stop that”.
He continued: “You cannot treat the common people in this manner, the new tax levies is a complete setback for Liberian businesses. We are calling on the President of Liberia not to sign that bill into law if she really love her people who elected her; our people are also enjoying the three days free calls provided GSM companies, charging extra on a minute call locally is another burden for the citizens themselves.”
More Complains Pile
The GOL’s latest tax levies have met serious discontentment amongst Liberian businesses, with some staging protest recently at the Freeport of Monrovia.
The Free Port protest saw several marketers severely brutalized by riot Police after the protesters tried to erect a blockade at the main road to the port.
The protest gathered steam after importers also complained that their goods were being held at the Free Port of Monrovia for too long due to high tax levies, something they said was crippling their businesses ahead of the festive season.
Recently, a group under the banner “Association of Telecom Consumers” also raised contention when they petitioned the Legislature, requesting the body to reject the increment on GSM calls. Something they claimed would affect the three days free calls.
In their petition, the group stressed that taxation on calls per minute would directly affect low income earners who are already struggling to cope with prevailing economic situation.
The group claimed that such decision would make access to information and communication technology very expensive for low income earners.
The petitioners stated: “This will result in a double taxation for consumers who are already paying 15% GST on the sale cost of scratch cards.”
The group claimed to be representing citizens from the 15 political subdivision of Liberia, including marketers, telecom consumers, low income earners, doctors, and students.
But the Liberian Legislature on Capitol Hill ignored that petition and later passed the new tax act into law, which now awaits the Chief Executive’s approval before being printed into handbill.
The situation remains tense as ordinary citizens, especially business owners, continue to decry the high tax rates, which have impacted the increment of food and other essential commodity prices on the local market.
‘Cut Down Expenditure’ – Kemanyah says
“We are calling on the Government to reverse its decision because laws are meant to benefit the people and not suffer them,” Mr. Kemanyah said, suggesting the slicing of government’s recurrent expenditure as a remedy to the looming budget short fall.
Rather than imposing new taxes, Mr. Kemayah suggested that cutting down its expenditures in the budget will improvise for competing national priorities.
“You do not impose taxes to solve the problem of budget shortfalls. We believe that the best way to resolve this problem is for the Government to cut off some of her expenditures and divert those resources to essential national priorities,” he said.
He hailed the Government’s recent pronouncement about relaxing the tax levies for the festive season, but advised that a lasting solution to the problem must be found rather than “shying away from the issue”.
“We want to command the Government for relaxing the taxes for the festive Christmas season, but we believe that we must work collectively to identify lasting solution to the problem,” Mr. Kemayan pointed out.
MOU with US Chapter
Meanwhile, the Liberian Business Association has announced the signing of an MOU (Memorandum of Understanding) with its USA branch.
LIBA President Kemanyah said the MOU would create market linkages for Liberian businesses and connect them to their counterparts in the United States.
The MOU is also expected to provide training for Liberian businesses to build their capacity for advancements, Kemayah said.
The agreement would also explore and attract several investment opportunities from the United States to Liberia.
Following a week-long assessment of the country’s business sector, the LIBA-USA delegation is expected to scout potential investment in the areas of Internet Technology (IT), import and export, and the surveying f possible areas for market exchanges.
“We are here to help Liberian businesses to grow and be more competitive."
"We are not here to compete with them,” Jackson K. George, head of the LIBA-USA branch, said at a news conference held over the weekend.
George said the MOU will improve the relationship with LIBA and its USA partners, saying it will also increase business relationship with the United States of America amongst others.