May 4, 2020, 2:28 PM
Focus on The Gambia has been doing well in tax collections to support the national budgets over the years. It is commendable that the GRA has been steadfast and consistent in revenue generation for national development. The question, however, is how can the government enhance the productive capacity of the poor through increased and unending system of taxation?
The intellectual mindsets of public officials could not envisage that the maintenance of a tax-based economy cannot excite economic growth and will only aggravate poverty and further our economic dependence on donor support. Let us look at the debilitating effects on the nation’s health, environment and purchasing power of the people in the taxation attitude.
The Gambia and KMC in particular have become a JUNK YARD for all types of second goods, derelict vehicles, expired drugs and foodstuff, workshops and food vendors, dumping of waste, environmental pollution, poor road networks, etc. How can we avoid such a situation when the drive for tax collection is allowing anything and everything to enter the country regardless of the need to keep the country safe and clean and keep the government running?
In this era, it is very expensive to maintain the system. Because the emphasis tends to be towards meeting the requirements of RECURRENT EXPENDITURES, the tax agency is constantly under pressure for increased revenue collection. As a result, there are too many taxes in the system such as import taxes, road taxes, corporate taxes, petroleum taxes, environmental taxes, sales taxes, airline taxes, property taxes, airport taxes, immigration taxes, area council taxes, income taxes, etc. Gambians, most of them, are now suffering from tax indigestion.
The government should consider it overdue for a policy shift from tax-based economic management to production-based economic reorganization, reorientation and reconstruction. It is to be stated that economic growth is not generated by tax collections. To transform the country, the means of accelerated socioeconomic development must be through interventions in the productive sectors of the economy such as agriculture, fisheries, tourism, and manufacturing. These are the areas that will excite economic growth and development.
The prescription on how to move our country forward will never come from overseas. Another point of reflection is the impact of COVID-19 on the economy. In this regard, one would expect that the government will give tax relief to the private sector operators and provide a stimulus package to support small businesses.
The Ministry of Tourism must be commended for reflecting on the tourism industry and providing it with some relief package. The government should create the enabling environment for the survival of the business environment and to reduce the burden on consumers who are experiencing high cost of living due to COVID-19 claims by the private sector.
There should be no constraints on the part of the government to employ some tax breaks in the economy in view of the massive inflows of donor interventions to ameliorate the effects of COVID-19 on the national economy.
In the long term, however, for sustainable development, the country must move away from cash economy to productive economy.