As possible budget shortfall looms
The recast of the 2017/2018 budget to perhaps tackle quick-impact development and empowerment in the pro-poor policy of the CDC-led government, is gradually elapsing with the delay of its submission which should have been since Thursday, February 15, 2018. The 2017/2018 fiscal period would finally end on June 30, 2018
The House’s Chairman on Ways, Means, Finance and Development Planning, Thomas P. Fallah, said the Recast Budget is yet to be received by the House of Representatives and the continued delay would entangle it with the 2018/2019 budget, whose submission is scheduled for the 30th of April, according to the Public Financial Management Law.
Speaking recently during the three-day Orientation retreat of members of the House of Representatives in Margibi County, Rep. Fallah urged the Ministry of Finance and Development Planning to act accordingly.
“The recast budget should have been submitted since the 15th of February, but now it has been delayed for eight days (Thursday),” Rep. Fallah said. “If the recast budget continues to be rescheduled, I am afraid that the submission of the 2018/2019 Budget would be a problem.”
Although reasons for the delay have not been sufficiently explained, it is being speculated that another shortfall in the budget is expected to be announced.
It can be recalled recently that the head of the the Liberia Revenue Authority (LRA) had expressed fears of a budgetary shortfall in view of the National Legislature’s decision to put a halt to the National Road fund tax scheme which had been projected to raise a total of US$11 million to support the national budget.
The Government of Liberia had proposed a US$0.25 tax imposition on petroleum imports to be allocated to a road tax fund intended to support the maintenance of the country’s road network. However, the Legislature was of the view that the proposed tax was leading to increased hardships on ordinary Liberians and therefore recommended its immediate suspension.
Since the suspension of the tax scheme, the GOL has faced difficulty in meeting its revenue projections.
Also, according to the head of the LRA, Elfrieda Stewart Tamba, the forestry sector posed another risk to the budget because of existing and pending MOUs between GOL and actors in this sector waiving taxes deemed payable to Government.
Commissioner Tamba had also disclosed that a US$6.1 million waiver on rice imports, considered an essential commodity, has also had a dampening effect on revenue collection. She added that while GOL had a heavy reliance on revenue derived from taxes on imports, she observed that only 35 percent of total imports were commercial as compared to non-commercial, which accounted for 65 percent of total imports.