Liberia Revenue Authority (LRA) Commissioner General, Elfrieda Stewart Tamba says the illicit flow of money from Africa is overwhelming.
Mrs. Tamba quoted the Mbeki Report on illicit flows of money out of Africa and said Africa loses about US$50 billion yearly and warned that it must stop.
Madam Tamba made the assertion yesterday, at the opening of a three-day forum and training organized by the Organization for Economic Cooperation and Development (OECD) at a hotel in Monrovia.
Otherwise referred to as the “Global Forum on Transparency and Exchange of Information for Tax Purposes,” the forum brought together about 25 persons from various institutions, including the Ministry of Finance and Development Planning, the Law Reform Commission and the Governance Commission.
The Mbeki Report which Commissioner General Tamba is referencing, is a document prepared by a high level panel established in 2012, following a meeting organized by the joint African Union Commission and the United Nations Economic Commission for Africa.
Its three basic aims are to develop a realistic and accurate assessment of the volumes and sources of financial outflows; gain concrete understanding of how these outflows occur in Africa, based on case studies of a sample of
African countries and, ensure that the panelists make specific recommendations of practical, realistic, short-to medium-term actions that should be taken both by Africa and the rest of the world to effectively confront what is in fact a global challenge.”
The LRA Commissioner General indicated that the technical assistance program was important for Liberia on grounds that it is aimed at strengthening collaboration and sensitization among all local stakeholders to enhance preparedness for the country to ensure passage of “Round 2-Peer Review” to avoid the blacklisting of Liberia for lack of transparency in financial matters.
She said it will also strengthen the capacity of LRA in the exchange of information for tax matters since tax evasion is one major source of illicit financial outflow.
She assured that Liberia is committed to amend the applicable laws to meet the Global Forum standard on transparency of information and to also facilitate the exchange of information in tax matters.
In furtherance of the commitment, Tamba also said “As a demonstration of Liberia’s commitment, our country ensured its passage to Phase II and compliance is scheduled for June of 2018.”
In order to convince stakeholders about this, Madam Tamba said they have embarked on the establishment of the exchange of information in the competent authority – the Domestic Tax Department – and development of the relevant manuals and related staff training.
Additionally, she noted that they have also embarked on the signing of the statement of intent to join the African Tax Administration Forum Agreement of Mutual Assistance in Tax Administration Matters, and expansion of tax information and exchange agreement networks from 16 to 20.
“This includes Canada in 2017 and the adoption of a protocol request also in 2017 from South Africa in relation to the inclusion of Automatic Exchange of Information,” she said.
Madam Tamba said it will detect tax evasion and off-shore wealth, deter people from non-compliance and encourage timely compliance by taxpayers and support domestic synergies among tax administrators in developing countries in their domestic resource mobilization strategies.
The automatic exchange of information is a new experience for Liberia. In this regard, the LRA Commissioner General said her institution needs to acquire the necessary information technology infrastructure, and ensures the passage in collaboration with the Ministry of Finance and Development Planning (MFDP) of the legislative framework that will facilitate the process in line with the new standard.
To further enhance the process, she said “The stakeholders jointly need to ensure the amendments to the Business Corporation Act are ratified before the next scheduled peer review.”
Commissioner General Tamba said “This engagement will further enhance local capacity to more effectively combat, inter alia, tax evasion, aggressive tax planning, illicit flow of capital and money laundering, thereby facilitating the collection of lawful revenues due our nation and people for the national good of all of us including the unborn.”
In brief remarks earlier, the Commissioner for Domestic Tax, Darlingston Y. Tarley said the technical assistance training will enable Liberians to fully understand how information exchange is done, noting that it will facilitate the fight against tax evasion.