By: Thaimu Bai Sesay
Amidst the speculations of taxes imposed in the 2024 Fiscal Year Budget Bill, The Financial Secretary of the Ministry of Finance has on Tuesday 14th November 2023 at the government weekly press briefing clarified that the 5 percent tax on rice importation in the new budget would not attract any price inflation.
It could be recalled that in the first reading of the 2024 FY budget, the Minister of Finance read out the proposed taxes on rice importation and other commodities which sparked diverse reactions to citizens.
In response to the ongoing diverse discussions over the tax to be imposed on rice, the Financial Secretary of the Finance Ministry intimated that the tax was not a new thing but a restoration as he said it had been in existence for quite a couple of years. “In 2009, the government took that action to wave off the tax which was 10 percent on rice due to the global food crisis that was starving the world,” he recalled.
At the press briefing, the Ministry of Finance Financial Secretary argued that tax inflation was not a recipe for price inflation, describing that notion as a populace view. He disclosed that 15 years ago the Government placed no tax on rice importation but said the country had still been experiencing continuous inflation on imported rice. “So taxation plays no role to such an inflation as the increment comes from the original producers,” he reinforced.
In his statement at the press briefing, the Financial Secretary Mathew Gingie explained that the government had been the sole body paying judges and Police, Members of Parliament, Ministers and other set of government workers without any assistance from the private sector. He justified that in order for the Government to effectively continue to render that function was one of the reasons for the new propose tax
Further justifying the reasons for the tax, Mathew Gingie went on to reveal that the Government had painstakingly taken records on that and had seen the potential need to invest with the tax and entirely relieve the people from buying expensive rice. “As a country we also have the same better and fertile land including the facilities. So why can’t we use the resources we give to those people to grow our own local rice and at the same time benefit our local farmers and the citizens quality of life,” the Financial Secretary rhetorical asked.
He added that the proposed venture would solidly address the huge cries over the continuous inflation on imported rice, adding that it was the only way out as Government could not stop the farmers from other countries from increasing the price of their produce.
He clarified that the restoration of tax on rice importation was to help cushion the uncontrollable inflation on rice. He assured of efficient and transparent use of the fund that would be raised from that tax. He added that there were wide array of private sectors who wanted to come to Sierra Leone and invest on rice but said the infrastructures had been the roadblock. “But if Government creates that enabling environment and factors for the private sectors it would be easier for them to come with their machines and produce affordable rice for the locals,” he expressed.
The Secretary affirmed that the venture taken by the Government was a wise decision and encouraged the people to less consider the populace view that tax would lead to price inflation. He assured that they would implement the same price tracking formula used for cement and other commodities for rice so as to prevent unnecessary inflation.
The Secretary statistically highlighted the import duties on rice from other African countries as he said Angola imposed 19.3 percent, Botswana 20, Rwanda 35 percent while Nigeria imposed 70 percent. He revealed that the tax imposed by those countries were a measure to support their local production of rice. ” So it is not a novelty for the Sierra Leone Government to impose 5 percent tax on rice import duties and that would not attract any price inflation. It is something that is very essential for the livelihood and sustainability of us as a nation. If we fail to take that difficult decision now we can’t solve it,” emphasized.
The Secretary informed that there were a lot of good things in the 2024 proposed budget bill not just the tax on rice and other commodities and urged Sierra Leoneans to spare some quality moments to go through the bill. He emphasized some of the good laws that geared towards supporting the local businesses as he made mention of the mild tax on small businesses. He disclosed that the Government would not impose tax on its citizens without any good reason behind that.