Finance Minister Discusses 2024 Budget and Economic Reforms

On Thursday, July 18, 2024, Minister of Finance Sheku Fanta Madi Bangura appeared on Radio Democracy 98.1FM’s popular program ‘Good Morning Salone’ to provide detailed insights into the approved budget for 2024. This budget is strategically designed to restore both micro and macroeconomic stability and to address the pressing issues faced by vulnerable and impoverished communities across the country.

Addressing Economic Disruptions

Minister Bangura began by acknowledging the significant disruptions caused by the COVID-19 pandemic and the ongoing Ukraine-Russia war. These global events have severely impacted food supply chains, resulting in heightened prices for essential commodities worldwide, including Sierra Leone. He emphasized that the 2024 budget is tailored to stabilize the economy by addressing these price increases and ensuring economic resilience.

Revenue Collection and Tax Policy

The Minister elaborated on the Ministry of Finance’s collaborative efforts with the National Revenue Authority to refine tax policy measures aimed at boosting revenue collection. He noted that these measures are focused on closing loopholes in the tax system while safeguarding the interests of the poor. He highlighted that the parliament granted the ministry enhanced powers over the Cooperation Tax System, which currently has a 25% competitive rate within the sub-region.

Bangura addressed the introduction of the ‘Minimum Alternate Tax,’ which ensures that even companies reporting losses contribute a minimum tax of 2%, down from the previous 3%. This measure aims to prevent tax evasion by companies whose accountants continuously report losses.

Goods and Services Tax (GST) Adjustments

Minister Bangura provided insights into the Goods and Services Tax (GST), which stands at 15% in Sierra Leone. He compared this rate with higher percentages in neighboring countries, which range from 17% to 20%. He assured that essential goods such as milk and sugar are exempt from GST, thus protecting consumers from additional financial burdens. Additionally, the government has introduced a Track and Trace System for locally produced and imported alcohol, cigarettes, and beer, ensuring accurate tax reporting to the National Revenue Authority.

Commitment to Feed Salone Program

The Minister reaffirmed the government’s dedication to the Feed Salone Program, a pivotal initiative aimed at improving food security. He announced that approximately 7% of the national budget has been allocated to this program, alongside a 5% tax reinstated on rice importation. This tax policy is designed to incentivize local farmers and bolster domestic agricultural production.

Inflation and Economic Stability

Minister Bangura highlighted a significant achievement in reducing inflation. He reported that inflation, which was at 54% in September/October 2023, has now decreased by 18%, bringing it down to 36%. This decline indicates substantial progress towards economic stability and sets a positive outlook for the country’s financial health.

Wage Bill and Salary Payments

The Minister provided updates on the projected wage bill, estimated at around 6.5 billion Leones. He confirmed that 3.07 billion Leones have already been disbursed for salaries, gratuities, and NASSIT contributions. He assured that all worker salaries have been paid on time, without any delays, demonstrating the government’s commitment to maintaining financial discipline and supporting public sector employees.

Future Economic Outlook

Minister Bangura concluded by assuring the people of Sierra Leone that the government is steadfast in its efforts to improve the economy. He expressed confidence that the measures outlined in the 2024 budget will lead to sustained economic growth and prosperity. He called on citizens to remain hopeful and supportive of the government’s initiatives aimed at building a resilient and prosperous Sierra Leone.

This comprehensive discussion on the 2024 budget provides a clear roadmap for economic recovery and growth, highlighting the government’s commitment to addressing both immediate and long-term challenges facing the nation.