Liberia: Government Warns against Misuse, Abuse of Investment Incentives￼
MONROVIA – The government of Liberia through the Ministry of Finance has warned the public against the misuse and abuse of investment incentives in Liberia.
An investment incentive is a policy implemented by the government to promote the establishment of new businesses or to encourage existing businesses to expand or not relocate elsewhere.
Issuing the warning at an opening of a five-day Technical Workshop on Tax Expenditures Monitoring and Evaluation in Liberia, the Assistant Minister for Revenue and Tax Policy at the Ministry of Finance and Development Planning, Hon. T. Ojuku Nyenpan, said the Government of Liberia is already striving to provide the enabling environment for investment activities to strive in the country.
In his opening remarks, he said through the issuance of investment incentives, the Government of Liberia encourages new businesses to begin their operations.
He further narrated that nearly all of the manufacturing and assembly companies in Liberia are beneficiaries of the Government of Liberia Investment Incentives Regime.
“Investment Incentives are critical and intervening vehicles that are used to drive new investments, expand the economy and provide employment opportunities,” Minister Nyanpan noted.
The Minister noted that Investment Incentives are also the major drivers of tax expenditures, which subsequently affect domestic resource mobilization and stakeholders.
He called on policymakers to endeavor to ensure that the intended purposes of the investment incentives regime in Liberia are achieved, without in the aggregate, negatively impacting revenue growth.
“This balancing act can be achieved by robust monitoring and evaluation of businesses and institutions benefiting from the investment incentives regime”, the Minister intimated.
He however stressed the need for coordinated and robust monitoring mechanisms aimed at monitoring and periodically reporting the utilization of investment incentives.
Minister Nyenpan thanked the Economic Community of West African States (ECOWAS) for their support in organizing the workshop. He also called on the participants to positively contribute to the deliberations.
Also speaking at the opening of the workshop, the proxy for the Ambassador of ECOWAS Country Office in Liberia, Madam Wallace described the workshop as the beginning of series of restitution of the content of the Tax Expenditure Guide for the benefit of specific countries, including Liberia, Nigeria, Guinea Bissau and Mauritania.
“Beyond the presentation of the regional guidelines for the management of tax expenditures, the workshop will consolidate and test a draft tax expenditure evaluation matrix in accordance with the regional guide and the good practices of countries accustomed to producing their annual reports on tax expenditures,” she noted.
She noted that the west Africa tax transition support program (PATF) aims to accelerate the process of tax transition in the ECOWAS region, saying, “The specific objectives of the PATF is to improve the management of domestic taxation and ensure better coordination of taxation in the ECOWAS region,” she said it also strengthened the fight against fraud, tax evasion, illicit financial flows and corruption, among others.