Liberia: ‘Pay Taxes to Avoid Foreign Aid’

The Liberia Revenue Authority Commissioner General, Thomas Doe-Nah, has urged Liberians to pay their taxes in order to increase revenue generation that will help to develop the country. 

He said when the revenue rises up to billions, there will be no need to accept or wait for aid from foreign countries.

“We are at a point as a country, people can tell us anything they feel like. You know why they are telling us anything they feel like? It’s because we are relying on their taxpayers for our livelihood.  We do not need to beg them if we are paying our taxes, if we commit ourselves to pay our taxes and carry our revenue to billions I can tell you we do not need aid from anybody,” he said. 

The call from the LRA boss comes weeks after U.S Ambassador Michael McCarthy frowned at Monrovia City Mayor Jefferson T. Koijee for blaming the lack of donor’s funding for the overwhelming filth in the nation’s capital, Monrovia. 

In his op-ed, the U.S Ambassador said his government contributes over $110 million per year of foreign assistance to Liberia. “Sixty years after the arrival of the United States Agency for International Development (USAID) in Liberia, 19 years after the end of the civil war crisis, and seven years after the eradication of  Ebola, the taxpayers of the United States contribute to this country over $110 million per year of foreign assistance,” Amb. McCarthy added.

This, he says, includes over $79 million per year donated to the health sector. Approximately $9 million is specifically for purchasing medications and commodities for the Liberian people and improving the Ministry of Health’s effective distribution and warehousing of pharmaceuticals,” he said.  

“Troublingly, Embassy investigations indicate that not only are some citizens diverting public medical resources and low-cost drugs for personal gain, but that babies, young children, and birthing mothers are dying needlessly as a result. What would J.J. Roberts have to say about this?”

In his defense, Mayor Koijee said the Ambassador misinterpreted his statements and said his municipal administration remains dedicated to address Monrovia’s waste problem. He also blamed citizens for not playing their role in keeping the city clean.

“When we are unveiling them [feeder roads] you do not see ‘...From [this person]’ anymore. Who attended those programs, us,” Commissioner Doe-Nah  said.

The LRA boss made these remarks when he launched an expansion to the orange mobile money services for taxes and fees. The expansion program allows users to now transact with over eighty different taxes and fees available across twenty-four government ministries and agencies using their mobile phones at their own convenience. 

The LRA boss calls for more tax pay comes as the national legislature awards 

 tax breaks to almost on foreign investments -- narrow the country’s tax base, which has been continuously eroded by multiple tax concessions (exemptions, reduced rates, and incentives).

Currently, many large-scale investments ranging from foreign direct investment to local benefit from numerous and different kinds of tax breaks granted by the legislature against the promise of creating jobs and other aspects of 'economic development. 

However, these tax exemptions, which have swelled in the last two decades, have impacted the country’s budget growth negatively in the form of foregone revenues — making the country more heavily dependable on external grants to fund almost all of its development projects, as well as revenue in the form of budget support. 

According to a 2019 report from the  World Bank, Liberia should, among other things, establish a process to assess the fiscal implication of tax concessions and that such a report on tax expenditure should be made public.

The report, Liberia Domestic Revenue Mobilization Policy, notes that while tax concessions are a universal feature of tax codes around the globe, the extremely narrow tax base in Liberia as well as lack of scrutiny on granting incentives and the fiscal implications calls for changes in the approach to tax concessions.

It added that the ability to deliver economic or social support to groups or types of taxpayers by allowing exemptions, deductions, and tax credits, generate real costs in form of foregone revenues, and operate without the need for a large infrastructure to deliver the targeted support and thus can be subject to less scrutiny than direct spending programs. 

The legislature, despite its love for the tax break, as a means of targeting new industries and mobile investments --  the impacts of such love is yet to be felt as the country remains poor, underdeveloped, and with the vast majority of its citizens unemployed, despite the presence of international companies that have benefited and continue to do from their tax breaks. 

One risk factor with tax breaks, according to a 2018 study by, the United National Department of Economic and Social Affairs Financing entails significant costs, such as revenue loss, low economic efficiency, increased administrative and compliance costs, and excessive tax planning and tax evasion, which may exceed their benefits and considerably erode the general tax base; and in some cases, few new investments, with a significant cost to the government. 

Eric Clarke, manager of Orange Money, expressed his excitement to expand services including taxes and fees on orange money. He stated that “as we expand on services with orange money, we will continue to work with the LRA and government to push for more”.

Deputy Commerce Minister Wilfred Bangura stated that the mobile money expansion program signals creativity and innovation from LRA in collecting taxes. The mobile money services expansion program covering taxes and fees is a collaboration between the LRA, UBA bank and Orange Liberia. 

Giving the overview of the payment expansion program, Darlington T. Talery, Commissioner for Domestic Tax, said the mobile money for tax payment program started in 2018 to bring convenience to tax payment.  

“Taxpayers will sit at their convenience in their homes, offices using their mobile money wallet to pay their taxes, so we started with a minimum number of government entities,” he said.  

According to him, the expanded mobile money tax payment covers all taxes being administered by the LRA, including administrative fees that will be collected from line ministries and agencies.

“So we are excited that once again we are expanding, we are digitizing and we are bringing convenience to the taxpayers. Because our intent is to raise a billion dollars revenue over the coming years. All of what we are doing is intended to expand our scope of revenue collection so that the government will have more resources to bring public service to its people,” he said.

Editor note: story update with addition information on tax break.