By Amin Kef (Ranger)
The Sierra Leonean government, led by the dedicated leadership of President Julius Maada Bio, is committed to elevating the nation to a middle-level country. In pursuit of significant socio-economic transformation, the President has been actively promoting investments across various sectors. While foreign investments have been encouraged, the government is equally focused on nurturing local entrepreneurship, with a particular emphasis on local manufacturing and innovation.
Currently, the economic trajectory of the country reflects the government’s ambitious programs, encapsulated in President Bio’s five game changers: Feed Salone, Human Capital Development, Youth Employment Scheme, Public Transformation, and Technology, which are set to be rolled out.
Implementing these game changers naturally requires funding, and taxation is expected to play a pivotal role in mobilizing the necessary resources, in addition to donor funding. However, imposing excessive taxes on manufacturing industries with the goal of generating revenue for these initiatives could prove counterproductive and detrimental to the economic transformation. Instead of serving as potential revenue sources, these industries could suffer stunted growth and restricted activities.
Members of Parliament, as representatives of the people, should recognize their primary duty to advocate for the interests of their constituents. They must acknowledge that burdensome taxes on local manufacturing will lead to higher prices for the goods and services produced, affecting the living standards of their constituents. The blame for these higher prices cannot be solely placed on local manufacturers when considering the high production costs and tax burdens they face.
It is imperative for Members of Parliament to advocate for favorable tax policies on behalf of local manufacturers when Finance Acts are presented in Parliament.
Furthermore, the government should recognize that while imports serve a vital role in supplying goods and services, a robust economic landscape requires the growth and sustainability of local manufacturing. If the government aims to promote the thriving of local manufacturers, it should implement tax policies that favor them over importers of consumer goods and services. A well-structured tax regime has the potential to invigorate the economy, fostering self-sufficiency and prosperity.
Importantly, if the government intends to create 5,000 jobs for the youth, as outlined in one of its game changers, it is essential to establish tax regimes that encourage the growth of local manufacturers. These businesses can generate employment opportunities for both skilled and unskilled labor, playing a significant role in reducing unemployment rates.
The expansion of the manufacturing sector will undoubtedly boost economic activity, driving GDP growth and stimulating investments in technology, infrastructure, and innovation, ultimately leading to a flourishing industrial foundation.
In conclusion, the implementation of favorable tax policies can ignite enthusiasm among local manufacturers, encouraging expansion and attracting new investments. This, in turn, reduces reliance on imported goods as incentivized local manufacturers offer domestically produced alternatives, diminishing the need for foreign products.
Tax incentives, such as reduced corporate income tax rates, investment tax credits, and accelerated depreciation for manufacturers, can spur economic growth and attract investments in local production. Adjustments to customs and import duties can also favor domestic goods, making imported products comparatively more expensive and stimulating domestic consumption.
In light of these considerations, President Bio and Members of Parliament must carefully assess tax levies on local manufacturers. Members of Parliament should actively advocate for favorable tax policies to protect local manufacturing entities from burdensome tax regimes, in order to safeguard the interests of their constituents.
By implementing these policies, President Bio and Members of Parliament can inspire entrepreneurship among local manufacturers, reduce their tax burdens, and provide them with the opportunity to invest in research, innovation, and skilled labor. This, in turn, enhances productivity, quality, and competitiveness, paving the way for a prosperous future where local manufacturers thrive and meaningfully contribute to the nation’s development.
