Shops and other businesses are under lock and key in Sierra Leone’s capital, Freetown owing to heavy taxes. It is not clear when businessmen will return to their shops as government decision remains in tact. The installation of electronic machines is also part of the deal to ensure that government loses no cent. Blocking leakages is a manifesto government by President Julius Maada Bio.
Shop owners have blamed the revenue collection agency, National Revenue Authority (NRA) for the harsh economic situation that is becoming tough every passing day.
Hit hard by the economic crunch, many traders have decided to leave Sierra Leone for other countries in search of good business climate. Neighbouring Liberia will host many of the Sierra Leonean businessmen as they seek to carry on business in a country devoid of harassment and undue hindrances.
A press release issued yesterday by NRA worsened an already polarised situation. The press release levies fines on taxpayers who fail to integrate or complete the integration processes with the Electronic Cash Register (ECR) system.
“Notice is hereby given to taxpayers who have failed to integrate or complete the integration processes with ECR that the Authority is now left with no option but to implement the full penalty of the law,” the press release reads in part.
It also notes that taxpayers’ refusal to integrate their systems with ECR System runs contrary to the country’s laws particularly the GST Act, 2009 as amended. The tax breach, according to the press release, leads to a penalty of
250,000,000.00 (two hundred and fifty million Leones) with an administrative assessment of potential revenue loss during the period of non-compliance.
NRA, according to the press release, has been exercising restraint, and is now time to act.
NRA Commissioner-General, Ibrahim Brima Swarray said taxpayers could complete the integration process within two months starting from 20th October, this year, and NRA can facilitate such process by payment of a minimal fee.
It is also clear in the press statement that failure to adhere to the deadline will attract penalties as provided by law. The shut down is the latest in a stream protest embarked on by businessmen in Freetown since the introduction of GST.
They staged a protest in 2008 in the early days of former President Ernest Bai Koroma, and the second was in July, 2022 when the electronic system of revenue collection was ordered by the revenue collection agency.
Under the electronic system, machines will do the recording of sales and collection to forestall tax evasion. The machines will be placed in supermarkets, hotels, guest houses, restaurants, bars, night clubs, building materials stores, boutiques, saloons, general merchandise, and other service providers, among others, a move the business community is not comfortable with.
A businessman, Musa Fallah Bah says NRA’s move is geared towards exploitation in the face of acute economic challenges.
“Businesses are starving very seriously owing to economic difficulties,” Bah told this press.
Despite grumblings among traders, NRA however insists on the use of the machines saying the model is within the law. It is an offence for failing to issue a GST receipt generated from ECR Machines even when not requested for by a customer.
They see no reason for NRA to post their officials in shops and other business places, a move they consider as an unnecessary economic burden. The heavy penalty for failing to issue a receipt adds insults to injury.
A taxpayer who fails to issue an electronically generated receipt, tampers with the systems or stops an NRA staff from installing the machines or damaging them will be construed as impeding tax administration. Le500m (five hundred million Leones) or five-year imprisonment will be imposed on conviction or both.
For heads to be kept above water, all registered GST taxpayers must notify NRA, within twenty-four hours, in case faults or problems are detected during the installation and operation of the machines for remedy.
GST taxpayers, according to the law, must also regularise their registration information with NRA for the issuance of a new Taxpayer Identification Number, and to get the machines installed immediately.
NRA revealed that businessmen should support NRA in mobilising the much-needed revenues for effective state governance. Traders are still amazed at the imposition of the machines despite the protests.
The bad blood between government and the traders have resulted into a dire business environment causing businesses to fold up. Businessmen have always wanted government to protect their businesses and not to lord it over them.