The Liberia Revenue Authority (LRA)’s threat to seize all under declared goods to Customs at the various points of entry across the country has raised critical but unanswered questions about the relevance of the pre shipment inspection regime that the Government of Liberia through the Bureaux Veritas(BIVAC)
The threat comes in the wake of LRA’s acknowledgement that many owners of goods passing through ports of entry have not been honest in declaring their goods, thus cheating the Liberian Government of its lawful taxes that must come in to help meet the goals and objective of the “Pro-poor Agenda.”
Declaration of goods means telling authorized tax collectors what you have imported into the country. Such information is usually contained in what is called a Bill of Lading which describes the type and quantity of goods being imported.
It becomes under declaration when a person brings in more goods than what is stated on the Bill of Lading at the port of entry.
The LRA, therefore, having realized this fraudulent act on the part of business people warns, “The Liberia Revenue Authority is cautioning taxpayers, especially importers of goods and owners of cargos to fairly declare every item loaded in containers entering the country, as it remains resolute in the collection of every lawful penny due the Government in line with the Liberia Revenue Code.”
Having also introduced new customs systems, the LRA’s centralized assessment system and inspection exercise has discovered that business owners are unfairly declaring goods and other items imported.
According to the LRA, based on investigation and gathered intelligence, it has decided that all goods under declared at the Freeport of Monrovia and other points across the country will be seized for proper inspection and declaration.
But this raises questions whether the Bureaux Veritas (BIVAC) is acting in cahoots with unscrupulous businessmen to defraud government or whether the BIVAC is remiss in its obligations to the Government of Liberia in which case Government then has the obligation to seek the legal annulment of the agreement between the Government of Liberia and BIVAC in order to protect its interest and those of the public.
The LRA further emphasized in its statement that “All goods will be valued based on the actual costs, for the collection of the lawful revenue as required by the code.”
The LRA warns business owners to desist from cheating the Government of Liberia, stressing that the new inspection activities currently ongoing at the Freeport of Monrovia is meant to strengthen the LRA verification for under declared items and not intended to overcharge business owners as being falsely stated by some importers.
The LRA statement quoted the Commissioner General, Elfrieda Stewart Tamba as having said that the government tax agency will not provide sanctuaries for importers who are in the habit of under declaring or smuggling.
Commissioner General Tamba indicated that as they strive to collect lawful revenue for the development of the country, it is the social responsibilities of businesspeople and others to engage in fair and transparent business practices.
Meanwhile the LRA in conjunction with the Ministry of Finance and Development Planning (MFDP) has begun the final validation of Liberia’s draft Domestic Resource Mobilization Strategy.
Domestic Resource Mobilization is tax revenue collected by revenue authorities and private savings in domestic money and capital markets.
The first phase of the validation began last weekend in Buchanan, Grand Bassa County where stakeholders from ten counties participated.
The objective was to give stakeholders the opportunity to review and make final inputs into the draft DRM strategy and harmonized a genuine national strategy to drive Liberia’s domestic resource mobilization agenda.
The participants, among others, highlighted the need for key measures such as effective monitoring system for revenue collection to avoid corruption, the introduction of a massive tax education campaign, including the full implementation of the country’s tax laws, as some of the vital steps, if taken by government, will help in expanding Liberia’s tax net.
According to them, there is a need for the tax authority to boost its manpower strength across the country and empower its local tax officials. This, they said, will buttress enforcement, compliance and accelerate revenue collection and growth.
Suggestions from across the floor encouraged government to prioritize the agriculture sector, expand tourism, and develop a proactive policy framework for a system oriented approach for natural resource management as a means of building a firm foundation for domestic revenue mobilization to support national growth and sustainable development.
For his part, an international consultant, and Senior Technical Advisor on Domestic Resource Mobilization, Momodou Foom, said there is need to promote a holistic push for sustainable capital investment in the local economy.
Serving as the lead facilitator during the DRM validation exercise, Mr. Foom said the locals themselves must exert huge efforts to invest in the economy.
He said such step plays a major role in the domestic resource mobilization process and serves as a key pillar in facilitating revenue enhancement and economic growth.
The domestic resource mobilization strategy effort led by the LRA and partners is in line with a global crusade highlighting DRM as pivotal for African countries to finance the Post-2015 Sustainable Development Goals (SDGs) and the Africa Action Agenda (AAA) 2063.
SDG 17.1 in particular is the target set to track and measure strengthening domestic revenue mobilization in countries through taxation as a key means of implementation while enjoining the donor community to support domestic capacity building for tax and other revenue collection.
Meanwhile the LRA’s declaration about taking decisive steps against importers who under declare goods has raised questions in the public about the relevance of the Bureaux Veritas (BIVAC) which has a standing pre-shipment inspection agreement with the Government of Liberia.
According to a former revenue official (name withheld) at the Ministry of Finance, under the terms of the agreement BIVAC is to ensure that over and under-invoicing of goods is prevented. Further, pricing, quality and correctly assessed duty are also assured under the agreement. Should an importer for instance under-declare goods, the LRA should raise issue with the BIVAC in view of the standing agreement between both parties.
According to the former official, the declaration by the LRA is but a ruse through which the LRA can impose double taxation under the guise of preventing under-declaration and forms of abuse by importers. the LRA meanwhile has remained tight-lipped in the face of such concerns.