By D. Wa Hne, Jr.
For a country with vast mineral and natural resources, generating revenues to target a $1.2b dollars budget shouldn’t have been a problem and is long overdue. Nevertheless, this possibility is a delightful beginning and hope its realization will trigger a more robust revenue and tax administration and create focus on effective management of our natural and mineral resources.
After all, Liberia’s mineral and natural resources have produced multibillion dollars foreign corporations and companies such as LAMCO, Bong Mining Company and the Liberia Mining Companies, including Firestone among others. But the country’s total annual budget has always been the pocket money for those who have reaped billions from us.
LEARN FROM NIGERIA SUCCESS STORY
I once had a discussion with a Nigerian billionaire I was persuading to come to invest in Liberia. He told me embarrassingly that my country’s annual budget was one of his companies recurrent expenditure for a quarter. What would he gain from Liberia?
Whatever has been Liberia’s jinx, we seem to be approaching economic liberation. But one of the best ways to do so is to review our tax laws on foreign concessions and royalties paid to government, tax holidays, duty free privileges, as well as equity share distribution and investment policies. We need to visit Nigeria’s success story on equity share participation of Nigerians in foreign investments, concessions and the domination of Nigerians in concession agreements, investments and share distributions. Perhaps such could be adopted to strengthen our economy and revenue boost that could catapult our annual budgetary projections beyond this year’s magical figure of 1.2b.
President Weah did gave it a try based on LRA assurance, but fell below US$800m under the late Commissioner General Thomas Nah Doe.
The current Commissioner General has given assurance that the LRA performance this time can guarantee this.
In the past, several factors could have accounted for the failure. There was a weak revenue and tax administration system, loopholes for tax invasion, tax fraud, bribery, corruption, low personnel performance capabilities, inefficient manual tax collection methods, lack of efficient digital infrastructure platforms, and on-line portals to track government revenues, low capacity build ups for tax collectors and administrators which accounted for deficiencies. This is not to suggest that modern tax platforms and capacity build ups were non- existent, but their optimal performances were being organized and introduced.
TOUGH MAN FOR TOUGH JOB
When President Joseph Nyumah Boakai took over the nation, it was evident that one of the most, if not the most vital agencies to deliver on his ARREST AGENDA would be the Liberia Revenue Authority and the Man he appointed as Commissioner General immediately stirred up concerns in public and official circles. There were two fundamental questions which took the lead in critical minds.
Did President Boakai thoroughly run a character assessment investigation on this Man and his working relationships with past Presidents and heads of entities? Would he and his officials cope with a man known to be an inflexible and friendless character who usually tells his boss, “with all due respect Sir, I cannot approve this unless the right thing is done” and to his friends a stern no to manipulative concepts or favors. Would President Boakai want to work with such excessive independent and unbending personality so stubborn in his rights? Would his colleagues find him exciting to work with cooperatively or a burden they would want to expunge?
Professor James Dorbor Jallah is said to have made President Ellen Johnson Sirleaf, at some point, to have repented placing him as head of the PPCC as complaints flooded her desk against an inflexible Chairman. But she could do nothing as the public and international partners eulogized his performance.
President George Manneh Weah was said to be weary of him as Ministers reported his lack of flexibility, especially from a man of excessive dominance in person of Honorable Nathaniel McGill who headed the Ministry of State for Presidential Affairs. One report has it that President Weah, at one point, refused his handshake at his birthday Party at his Jamaica Resort , but could not fire him. He patiently waited for his tenure to expire and then let him go out of his government in peace. Immediately Carter Center picked him up as Country Representative. There, observers believe, he rightfully belonged. Did President Boakai know what he was getting himself into?
As Vice President, this man could not have escaped the radar of such a man as the Vice President, but it seems to President Boakai that, “better to suffer Jallah’s inconvenience and get the job properly done, than to have all the comfort and complaint- free – working relationship and end up with bad outcomes”.
INNOVATION AND RESULTS
Since his appointment as LRA Boss, the output of the institution has been more of an astounding result than disappointment and complaints as he has exceeded revenue targets set. This feat could not have been made possible without the professional backings of the Domestic Tax Commissioner, Margaret Krote and the vigilance of Customs Commissioner Saa Samoi. They both add to LRA magical performance.
In 2024, a target of US$690m was set as revenue to be collected to support budget projections, but that was surpassed by additional US$10m, thus swelling the revenue envelop to US$700m.
This fiscal year, LRA has set a target of the revenue envelop to US$804m. Current performance indicators show that this Professor of Mathematics calculation may even exceed this target and achieve Liberia’s first ever budgetary projection of US$1.2b. In recent public statement, Professor Jallah spoke affirmatively that the LRA has the capacity.
Liberia’s hope to ascend its budget threshold to a billion dollars or more began with President George Weah. The LRA had given him the assurance that it would make it possible, but there were shortfalls as the machinery to perform that task was not efficiently and effectively aligned with the goal.
Why would this be possible now? From in-house sources and research, there is now an improved tax compliance mechanism and digital platforms and tools and uncompromising rigid enforcement of tax laws employed. Also there is a tight-air system internally that closed doors to tax collection frauds, tax invasion loopholes and now an effective revenue mobilization strategies which identifies new tax sources and make existing sources that were non-tax compliant to become good-tax compliant on real-time basis. The LRA has introduced newer measures that make transparency and accountability effective. An on-line portal has been put in place to track government revenue collections in time.
MORE CHALLENGES TO TACKLE
Despite achieving what non – financial analysts would describe as magical translations or transformations in revenue administration under Jallah and his team, SOE’s remained a contradiction and challenge to revenue and budget projections as they are under-performing. Their weak performance against projections would usually end in shortfalls. Further, there is abuse of duty free privileges which prevents the LRA from collecting real tax from major tax payers. Importantly, Liberia’s Maritime has been a challenge without explanation.
As LRA target projection is 94.1% of the budget, it is a real challenge to meet up with. But looking at internal controls, capacity efficiencies, and on-line digital portals to track government revenues, the Man President Boakai named as Commissioner General may need to be as ugly as possible with no smiles, nor look into the eyeballs of back door negotiators, observers hint.
The man being described as one without friends might take his job too serious as his inflexible posture is already earning him enimity.
Commissioner-general Jallah is highly assisted by an organized efficient administrative strategist in the person of the youthful, but enterprising Samuel Bennett who caused a shake-up by rotating personnel for better performance and results.
However, the Jallah’s team needs more determination and harder work to curb the excessive abuse of duty free privileges, maximize their fight against tax evasions, SOE’s inefficiencies and syndicates, as well as placing more emphasis on capacity building on digital tax transformative knowledge and applications for both tax workers and tax payers. Further there need to be constant rotation of tax officers assigned to key revenue generating areas to avoid inducements.
