May 24, 2021
By: Francis F.M.Harding
Prior to the adoption of the 2030 agenda for the Sustainable Development and the Addis Ababa Action Agenda on Financing for Development, The international community has set ambitious goals to end extreme poverty and boost inclusive sustainable growth by 2030.
Achieving the sustainable development goals requires massive investment in physical human capital which is especially challenging for developing countries. They will need significant resources in additional financing to foster sustainable and inclusive growth. The Addis Ababa action agenda provides financing framework for the SDGs.
Recognizing that mobilizing domestic revenue is critical, a country needs to collect 15% GDP in taxes to deliver basic services like water, energy and infrastructure. Today at least one third of the poorest countries fall below the 15% threshold; but it is not the amount of revenues that matters; it is how revenue is raised that is so crucial.
Focus is on quality, fairness and equity of domestic tax collection. Any tax structure for better or for worse must show equity within society empowerment of women and girls, sustainability of the environment, private sector development and good governance and trust in institutions at the same time. There is NOW unprecedented need for the international tax cooperation. To address tax transparency international tax avoidance and division. So what can we do address these challenges.
The answer lies in effective laws, policies, and administration in the overall tax system of regimes to govern the extraction of natural resources of regional and international cooperation.
This is important in blocking illegal funds and criminal proceeds and these requires partnership among various stakeholders governments, taxpayers, donors, civil societies, and most of all citizens that will the international organizations the International Monetary Fund, Organization for economic Co-operation and Development (OECD), United Nations and the World Bank Group. They have all joined effort to create a platform for collaboration on tax and help to enhance the effectiveness of their support to developing countries on domestic resources mobilization including through the design of medium term revenue strategies.
Taxation is very important because it is one of the means to help a country deliver services to their citizens that are critical for enhancing their human capital through education and health. Achieving SDGs requires enormous mobilized financial resources. Taxation is a key instrument to mobilize domestic revenue with plan and should be used to achieve our common goals. What is very important is how we can mobilize our own resources and what is so important is how we mobilize these resources. We have to take care of concern like equity, efficiency, tax compliance, and effectiveness of mobilizing these resources.
Taxes are the most important source of government revenue in modern economies. It is at the heart of the social contract between a modern state and its citizens. In return for fulfilling duties such as paying a fair share of taxes, citizens are provided with security, infrastructure and social services. Is like there is no strong commitment by the citizens of their mutual responsibilities, and so the ability of the tax structure to yield substantial revenue is significantly reduced. As I was talking with some tax experts they said both the central and local governments are not being serous about taxation. If that is so concerted effort at the central and local levels government to collect a genuine tax reform can yield substantial dividends with the tackling of a number of challenges relating to: widespread of corruption in tax collection, week administrative capacity for tax collection, mismanagement of tax or public funds, the attitudes towards paying of tax, pervasive tax avoidance and evasion.
I believe why the Sustainable Development Goals is so important is about domestic resources mobilization to achieve the Sustainable Development Goals. As we now have tax cooperation, and developing countries like Sierra Leone to collect resources to fund for her Sustainable Development Goals.
In 2015 the formal UN Secretary-General Kofi Annan give an interview to the International Bar Association about the UN Sustainable Development Goals which he contrasted to the Millennium Development Goals “this new sustainable development goals is not just a government, is not just a country of the South but is a global demand we hope the private sector will play a role, we hope governments themselves will go back home and begin to implemented, the SDGs are much more complicated, much more complex”.
The move towards poverty reduction is and will continue to become, an increasing important element in economic growth and development, hence in September 2015; leaders from 193 nations set the ground for the new Sustainable Development Goals. Africa is a continent in despair that Sierra Leone fortunate to be part off. Despite its enormous natural and human resource endowments, the continent has been trailing in all socio-economic indices of development growth, poverty eradication and sustainable development. Domestic resource mobilization if crucial to achieving the Sustainable Development Goals and sustaining the achievement, and any longer term development goals.
In principle, the Sustainable Development Goal’s (SDGs) are good framework for promoting development. The SDGs are unique in that they represent the second global agreement between the heads of state of developed and developing states together with the United Nations and the Bretton Woods institutions. Here is a framework that seeks to eradicate problems besieging the world’s poorest countries; eliminate poverty, erase hunger, establish good health and wee-being, provide quality education, enforce gender equality, improve clean water and sanitation, grow affordable and clean energy, create decent work and economic growth, increase industry, innovation and infrastructure, reduce inequality, mobilize sustainable cities and communities, influence responsible consumption and production, organize climate action, develop life below water, advance life on land, guarantee peace, justice and strong institutions and build partnerships for the goals.
I believed that much more needs to be done in achieving the Sustainable Development Goal’s as we have gone five years of the fifteen years target. There is need for new policies that look at other ways of sourcing new funds and the issue of mobilizing resources is important. For example in Sierra Leone National Revenue Authority (NRA) are working to meet its target set. This is where the issue of taxation comes into play. While external finance is attractive the danger is in accruing unnecessary and excessive debt burden. Taxation is emerging as most central to economic development agenda discourse compared to other development financing mechanisms like trade and aid as it provides a stable flow of revenues to finance development priorities.
Beyond resource mobilization, tax is an effective tool to enhance accountability between government and the citizenry; taxation allows the citizens and their governments to draw a social contract as taxpayers would like to see what their taxes have been used for. I have found out that less attention is paid to citizens when governments are using more aid monies than own funds.
I want to remind readers about an African son, our brother, uncle and father. A true global leader, the man who Secretary-General of the United Nations from 1997 to 2006 and co-recipient, with United Nations, of the Nobel Peace Prize in 2001, symbolizes the struggle to improve the lives of the poorest and most marginalized people throughout the world in the eyes of many Heads of State. Kofi Annan fought to make the world a better place for everyone, a place where resources are shared equally both at national and international level. So I am pleading to African leaders to make sure that Kofi Annan dream don’t fall by.
Following the current trends, Sierra Leone is unlikely to achieve all the Sustainable Development Goals by 2030. Investments in the Sustainable Development Goals would need to be scaled up substantially to achieve the SDGs by the target date of 2030. The huge financial resources required to achieve the SDGs by the date pose significant challenges to the revenue mobilization. Let all citizens pay’s their taxes and government should use it judiciously for Sierra Leone as a country to achieve the Sustainable Development Goals by 2030.