The Liberia Macroeconomic Policy Analysis Center (LIMPAC) through its local consultant; Consultant Management Enterprise (CME) has completed and published a study on Domestic Resource Mobilization with emphasis on improving tax administration. The study, which was supervised by LIMPAC was funded by the African Capacity Building Foundation (ACBF). It was conducted using data collection and analyses, desk review, consultations, and interviews. It gives insights into the current challenges of the Liberia Revenue Authority (LRA) and other revenue generating institutions in administrating both tax and non-tax revenues.
This study is of critical importance because domestic resource mobilization is critically important funding programs and projects of Liberia’s new development agenda; the pro-poor agenda for prosperity and development (PAPD). The PAPD centered on four key pillars projects strong desire of the Government of Liberia over the next five years to meet the high expectations of positively transforming the lives of Liberians. The preliminary cost estimate of the PAPD is US$7 billion and over the 5yrs of the PAPD implementation, domestic revenue generation is estimated at US$3bn. This projects an equivalent financing gap of US$4.5bn, which raises significant concerns for leveraging on domestic resources mobilization in addition to grants and debt financing.
The study in its recommendations emphasized robust reforms in tax administrations, especially in tax education and taxpayer services, training and support for tax auditors, digitization of tax payment, and investment in physical infrastructure of rural tax collectorates.
Link to the report: https://limpac.org/wp-content/uploads/2018/11/Domestic_Resource_Mobilization-MRD.pdf