Towards Koindu Customs post after GST’s introduction

May I start by extending my best wishes to all my readers, as we have entered the year 2010. May the year 2010 be as prosperous as possible.  Indeed, the year 2009 was a challenging year, but we must have learnt a lot of lessons as a country, both on the political and economic fronts, and we should now move forward.  Again, may I inform all, especially my colleagues at the FOI cyber space that, it would be wrong to come out with an opinion now on what the ACC has said of the NRA, when they (ACC) are investigating. I am not a lawyer but one thing I am sure of is that if one is to do, as colleagues at the FOI discussion forum are attempting to do, it will prejudice the ongoing investigation, and it has its own legal ramifications.

All public institutions, just like human beings, are expected to face challenges, not least the NRA. So, let us now look at other positive developments within the NRA. Prior to us, going for the Christmas holiday, I wrote an article on the then pending introduction of the Goods and Services Tax (GST). Today, I am republishing sections of that piece, with additional input, but especially on the pending commissioning of the Koindu Customs Posts in the near future by the NRA. I have always maintained that the growth of a country is the collective responsibility of all and sundry; it is only when efforts are embarked upon by the citizens of a country that such a country could reach the apex of development.

At the national level, Sierra Leone has in recent time, taken the path of national development; it has been moving both socially, economically and politically, no wonder that efforts are still being initiated by government, and even by the donor community to take this country to the level it ought to be, in terms of development.  Granted that the country is gradually progressing, it should be underscored that we still have numerous challenges we need to overcome as a country that has almost been able to meet the trauma of a civil war that lasted for over a decade.

In recent times, I wrote that the socio-economic and political development of Sierra Leone is based on a number of factors, primarily among them, is the willingness of the majority of the citizenry and foreign residents to give significant support to government. It does not mean that because one is giving support to government, or, is a card-carrying member of the party in power, he/she should not criticize that government when its goes wrong, and is not stimulating goods and services reaching the people. Still, government should also be praised when they do things which are praise worthy.

Over the past two years especially, efforts have been taken by this government to accelerate economic development in the country, and this is where all hands should come together in the dream for a better Sierra Leone.  The NRA is one of the major components responsible for the growth of Sierra Leone, both in terms of economic and social stand points. Despite the seeming challenges ahead of the authority in terms of ensuring people comply with tax payment; it has been working towards meeting the dream of President Koroma.  The test phase of the Automated System for  Customs Data, and the soon-to be-introduced Goods and Services Tax all being examples of how the NRA has been working towards actualizing the dream of President Koroma.

We should at this point be reminded that, the GST has commenced operation, following the decision by the government to listen to stakeholders who had asked for a postponement of the GST to January this year. As has been stated over and over again, the GST is not a new form of taxation, but instead, a replacement of seven existing taxes in the country.  Before the GST comes into effect on January 10, 2010, there exists taxes like: import sales tax, domestic sales tax, restaurant tax, message tax, entertainment tax, hotel accommodation tax and professional services tax.  But with the pending GST all of these taxes are going to come under one umbrella, thus creating an enabling tax environment for the taxpayer. So, in essence, GST is not a super imposition on the existing tax structure, but a replacement for these taxes listed above.

With the introduction of the GST, we shall still continue to pay income tax. Now, in Sierra Leone, there are two broad categories of taxes-direct and indirect taxes; direct tax is the class of taxes levied on incomes and earnings. It is an obligation on every citizen to pay tax on incomes and earnings.

GST, like the current sales and other taxes on goods and services, will be collected by businesses that are actually registered with the NRA to serve as agents on behalf of the Authority.  These businesses will charge tax on all their sales, taxable under the laws of the GST.  It should be noted in this regard that the registered business is also charged GST by other GST registered businesses from whom taxable purchases are made.

There are potential benefits that would attract business people to register with GST and they include, but are not limited to: a GST registered business enjoys the benefit of getting back the GST incurred on input purchases by deducting it from the output they charge on to their customers.  It will also lead to a positive standard in terms of record keeping and at the same time, ensures transparency in business practices, better planning and helps to strengthen internal controls within a business setting.

But on the whole, it could be stated that the commitment of the government towards improving the standard of living of the average Sierra Leonean has gained momentum, and there are signs that things will change one day for the better. That is why state institutions should continue in their efforts towards cohesive national development.  The NRA may be having challenges, especially in ensuring that people are not coerced to pay taxes, but this is a challenge it shall definitely overcome one day.  The GST is just one of several steps aimed at helping in improving the standard of living in Sierra Leone. It will go a long way in ensuring an improvement in the economic front of this country.

It should be made clear also that the  commencement of the GST is not the only development that has taken place within the Authority; all things being equal, there is also going to be the commission of the Koindu Customs Posts in the next couple of weeks from now. This will follow the introduction of the Automated System for Customs Data (ASYDUCA) which is a computer software programme that is used by customs administrations around the globe when dealing with import documentation.

The commissioning of the Koindu Customs Posts will go a long way in addressing a number of issues for us as a country; in the first place, it will add to the revenue generation base of the NRA, thus helping to solve national problems; it will also help to foster trade between Sierra Leone and its sister neighbouring countries like Guinea and Liberia.  It will also serve as a means of providing security along our border areas.

The fact is, Koindu used to be one of the potential revenue generating areas for Sierra Leone; it was also a major point of interaction between Sierra Leoneans and their fellow African brothers who would come from countries like Guinea, Liberia, Ivory Coast et al to trade in business. But all of this became affected by the decade long civil war in Sierra Leone.

But with support from the British Government, through the Department for International Development, plans are afoot for the commissioning of Koindu. It should be made clear that the donor community has been very supportive of the efforts of the Sierra Leone government to foster socio-economic development and the fact that Koindu is going to be opened with support from DFID is an indication that they (donor community) want to see the growth of this country, and having tested the pulse of the NRA, it is but clear that, the NRA is ready to move this country, it is ready to support President Koroma’s agenda for change and it will continue to generate revenue for the country, and it will continue to work in consonant with the support of its valued taxpayers, without whom, the NRA cannot succeed.  Practically, during the last budget speech last year, it was made abundantly clear by the Finance Minister that the NRA is crucial to the government’s agenda for change, taking into account the functions of the NRA to national development.  And when those functions are put adjacent to President Koroma’s Agenda for Change, it would be realized that, indeed, the NRA is vital to the current programmes of the government.

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