Finance Act 2016 Is Good For National Economic Growth
Published On : 2017-05-16 10:12:16
<< Back to previous
   
There has been a lot of debate in the public domain over parliament’s decision to bring into effect a new Finance Act 2017 to replace the previous Finance Act 2016.
 
 
Proponents of the new Act who include the National Revenue Authority and the majority of parliamentarians argue that the previous Finance Act 2016 deprives government from much needed revenue for development and other purposes.
According to them, NRA loses a whopping Le15 billion monthly due to importers of alcoholic beverages stopping to import due to higher excise duty.
 
 
One takes this argument cautiously; given the fact that since the Finance Act 2016 was passed about a year ago, we see a lot of foreign made alcoholic beverages in the market.
 
 
 
The speculation is that the importers before the Act was passed imported a very huge quantity of foreign beverages and stockpiled them to take advantage of higher prices (check NRA record to prove or dispute this claim). It is known that the importers dubiously changed the shelf life of imported beer and stout from six months or one year to eighteen months.
 
 
The other speculation about why government is getting no revenue from imported beverages is that the importers smuggle these foreign alcoholic beverages into the country (because the products are seen in the market), thereby depriving the government of revenue.
 
 
Meanwhile, as the argument rages on, a very large agricultural sector, the Sierra Leone Sorghum Farmers Association, have argued strongly that if President Koroma gives his assent to the Finance Act 2017, it will reverse the intentions of and gains made by farmers under the Finance Act 2016 by serving as a disincentive to grow more sorghum.
 
 
Through the Finance Act 2016, the number of sorghum farmers countrywide had grown from 10, 000 to over 25,000 in response to the huge increase in demand by the Brewery to use the product for the manufacture of its products.
 
 
This is very important in the implementation of the Local Content Policy which seeks to empower indigenous entrepreneurs and businesses to have a greater participation in the supply and value added chain.
 
 
However, as the two sides in the debate await to see whether President Koroma will give his assent to the Finance Act 2017 after carefully weighing the advantages and disadvantages to the local economy in general and future economic growth, the jury is out on the short and long term benefits to the country’s farmers, NRA and the country of the Finance Act 2016 whose main intention is to create more employment in the agricultural sector, to encourage manufacturers to use more local products and in the process reduce the huge amount of scarce foreign exchange used to import raw materials.
 
 

Certainly, the issue is contentious. Should we as a nation continue to benefit the small percentage of importers of alcoholic beverage or should we use the law to empower thousands of farmers and the Brewery who, when they reach full capacity, will produce more here; thereby giving work and increased income to farmers, middlemen, transporters, distributors, wholesalers and retailers which will result in more tax revenue for the NRA? 

 

Amin Kef Sesay (Ranger)

 
 
5 Ways To Get The Lowest Price On Your Next Car Purchase
 
SCP-GAFSP to resurrect Palm Oil production in the Northern Region
 
Stellar, Octea sign mining deal for Sierra Leone diamond project
 
With the PEC Smart Meters....No need to increase Electricity Tariff CSOs Affirm
 
Abdul Aziz Koroma bags Mercury Le161 million
 
Big boost for Sierra Leone Leone economy... Acquila company to invest in gold refinery