Sierra Leone reforms outdated tax laws, as economy grows at 6%
As Sierra Leone prepares to reform outdated tax laws, the country’s economy is this year growing at 6% with prospects for more growth, said Finance and Economic Development Minister, Dr. Samura Kamara.
In an interview with West Africa Democracy Radio (WADR), Kamara said this year alone, economic growth in the country’s mining economy is due to rise to a little over 30%.
The country has a large deposit of diamonds, iron ore and other minerals, which is set to be boosted with recent discovery of oil off the country’s Atlantic coast.
Economists say the reform of Sierra Leone’s tax regime is crucial in improving the country’s economy, as a reformed tax system would be mutually beneficial to both the government and citizens.
It’s not yet known what shape the tax reform will take, but the Goods and Services Tax (GST), which was introduced some two years ago, is now above three percent and it keeps on rising.
But Kamara said GST now accounts for 3% of Sierra Leone’s Gross Domestic Product (GDP).
“So we want to look at legislations on what more needs to be done in improving tax administration…and of course tax compliance is also important,” the country’s Finance Minister told WADR this week after a meeting with the international audit firm, KPMG in Freetown.
He said in reforming the country’s tax law these crucial questions will be asked: “What makes people evade tax? Is it that the tax regime is onerous, it’s difficult for them?”
Ahead of the country’s presidential and general elections in November, some political observers and some business people fear there could be political violence, given the level of political tensions and previous incidents of violence.
But Sierra Leone’s Finance Minister has allayed any fear of elections violence and urged the business community to go on with their normal activities in the run up to the polls.
“Elections in 2012 should not be a deterrent and it should not frustrate them, because the elections will be fair and we do not expect any violence in the (upcoming) elections,” Kamara assured.
Incumbent President Ernest Bai Koroma of the ruling All People’s Congress Party (APC) is seeking his second mandate.
WADR’s Freetown Correspondent Mohamed Konneh speaks with Sierra Leone’s Finance and Economic Development Minister, Samura Kamara in an exclusive interview.
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