A delegation from the Economic Community of West African States (ECOWAS), on Wednesday, June 1, 2022, met deputy finance minister for fiscal affairs Dr. Samora P.Z. Wolokolie to discuss the process leading to Liberia’s transition from Goods and Service Tax (GST), to Value Added Tax (VAT).
Through its implementation, about 30 percent shares of VAT revenue in the total tax revenue in the ECOWAS members state is expected to be collected by the government. The VAT will focus on big companies and enterprises for its collection, and without having any negative impact on the government.
Deputy Finance Minister for Fiscal Affairs Dr. Samora P.Z. Wolokolie at the delegation visit acknowledged ECOWAS role for including Liberia in the PATF program.
Dr. Wolokolie assures the team of Liberia’s commitment to the ECOWAS protocol that mandates member states to transition to VAT.
“As deputy minister for fiscal affairs, and head of the department responsible for ensuring this transition, I can assure you of Liberia’s commitment to the ECOWAS protocol that mandates member states to transition to VAT”, Dr. Wolokolie said.
According to him, the country is working hard with regard to the transition, and have outlined measures including the VAT roadmap, which will lead to a smooth migration.
He thanked ECOWAS for the support through capacity development and stated that the migration is of vital importance to the country.
For his part, ECOWAS Tei KONZI, Commissioner of Trade, Customs and Free Movement, called on Liberia to ratify the Continental Free Trade Agreement. “If there are reasons why Liberia has not ratified the agreement, tell us, so we can work along with you on resolving the issue you have”, Mr. KONZI said.
Mr. KONZI indicated that the ECOWAS commission supports Liberia, and expressed hope that 2023 will not affect the implementation of the VAT.
The VAT, he added, takes into account certain merchandise that are excluded from tax collection, and so it is important that all partners ensure its implementation.
However, KONZI explained that government goodwill will enhance with the VAT implementation, while the mobilization of political actors for the VAT program is essential.
“The government of Liberia has made tremendous progress, because they have agreed on personal tariff by taking part in the VAT program so that everyone can be on the same path” Tei KONZI said.
The meeting with the deputy finance minister and other partners followed the successful launch of the Support Program for Fiscal Transition in West Africa (PATF) activities in Liberia in November 2021. PATF is being financed by the European Union (EU) under the 11th European Development Fund (EDF) for the benefit of ECOWAS Member States.
As part of PATF activities, Liberia is receiving specific support under this program for which the Government of Liberia is expected to implement VAT in the country in line with ECOWAS standards. To support this component, a non-principal expert is now based in Liberia to ensure the effective achievement of program objectives and to introduce the VAT reform in Liberia.
In addition to Liberia, PATF is supporting Nigeria and Guinea Bissau to implement VAT in line with the ECOWAS VAT Directive.