TITLE:
The Impact of Tax Strategies on Revenue Mobilization in Sierra Leone
AUTHORS:
Abu Kai Kamara, Sheku Kamara
KEYWORDS:
National Revenue Authority (NRA), Pay As You Earned (PAYE), Domestic Tax, Extractive Industry Revenue, Succession Plan, Gross Domestic Product (GDP), Sierra Leone
JOURNAL NAME:
Open Access Library Journal,
Vol.10 No.8,
August
30,
2023
ABSTRACT: Tax revenues are essential for government operations. This reliance on tax funds creates an incentive for governments to be accountable to taxpayers. Citizens expect responsible and efficient use of tax revenues, leading to improved governance practices. Choices regarding tax reform strategies have significant societal implications. They affect priorities, income distribution, and the relationship between the state and its citizens. Effective tax reforms can align state policies with the needs and interests of the population. Periodic evaluations by tax experts are crucial. These evaluations assess the performance of different tax categories, identify weaknesses, and provide the basis for tax reforms. It’s important to have a comprehensive understanding of the tax system. The research indicates that there’s been more emphasis on indirect tax reform than on direct taxes. This might have consequences for income distribution and fairness in the tax system. Many taxpayers lack sufficient tax education, leading to non-compliance. This highlights the importance of taxpayer education to ensure compliance and a better understanding of tax obligations. There’s room for improvement in domestic revenue mobilization. While there has been an increase in revenue relative to GDP growth, challenges such as the burden on formal sector employees and organizations remain. The findings suggest the need to adjust thresholds, revise lists of zero-rated supplies, and reevaluate tax-exempt institutions. These changes can help capture more income for tax purposes and ensure fairness in the tax system. Trade tax reform is important for developing countries, but policymakers must consider the unique challenges posed by informal economies. Tailored solutions are necessary to raise revenue while preserving economic efficiency and welfare. External events like the Ebola and COVID-19 pandemics can impact the benefits of tax reforms, highlighting the need for resilience in revenue generation.