Let me start off by stating this, there is nothing wrong with taxation; taxes are used to defray national budgetary expenses globally. However, everything goes wrong when taxation, a leakage in the income-expenditure stream, becomes disproportionate to investments, relevant government purchases, and exports (injections). Tax becomes painful and inhumane when governments impose policies that strangulate citizens economically. When the government is telling us to pay them more of our money so that they can do us less or even no good, instead of leaving us with our money to do our own things – to buy our own gas for generators because we lack stable electricity, to buy polish for our shoes after walking on dusty roads, to spend extra cash on research to learn because education here is not transformative, and spend our money on internet to gain access to global opportunities that they fail to provide us in our own country with our taxes.
Here we are again with no choice to make, but an imposition by our own Government. Communication, with recharge cards as a medium, is inelastic without close substitutes, i.e. we can’t function without it. The government is smart in making these moves. They understand fully that internet access is a necessity in this ever-growing technological world; many of us must be online daily to accomplish some tasks and will have to pay the cost. We will have to reduce our consumption of other goods and services to make indirect payments to the government and get nothing in return. We may stop buying food of some quantity, clothes of some quality, or other accessories; hence, affecting many businesses in addition to the telecommunication companies. Sadly we barely understand what happens with all of the taxes we always pay. We cannot boast of government subsidies or social services. Until now, we are still clueless about what the government is planning to do with the 100% increment in data cost and 66.66% increment in voice calls surcharges they will generate. We are yet to understand what they have even been doing with the additional revenue generated after they imposed floor prices over one year ago. While these extra taxes may affect those corporate institutions in terms of revenue generation and returns to scale, it is us, the population, that the burdens of tax rests on hugely. The institutions unwillingly shift the burden onto our shoulders through increment in data and voice calls surcharges, because our Government ordered them to.
As it stands, a future for technological advancements is grim; telecommunications is essential, and creating unsafe environments for mobile companies to thrive undermines growth. To acknowledge worse, the government does not seem to care about ORANGE-Liberia’s threat to offshore (remove their company from Liberia); the government’s lawyers vehemently outclassed the corporate institutions’ lawyers in court. Our government failed to recognize the long-term risks of job losses in the thousands and partnerships that will undergo liquidation when ORANGE leaves. ORANGE is the official sponsor of all the National Sport Teams and the Liberian National Football League. They support local talents and social ventures, provide subsidies to startups, and offer capacity building programs for youth. Sadly, the GSM Companies even took our government to court, through the Liberia Telecommunication Authority, arguing that the Order proposing the Floor Pricing for data usage and calls was against the the welfare of Liberian citizens and lost.
After months, when ORANGE fails to cope with the high taxation and decides to leave, they will leave us with a monopolistic telecommunication sector, one in which Lonestar Cell becomes the industry. The insane part of this situation is that even the companies who should be glad for more revenue and income are begrudgingly required to implement the order of the government who should be seeking and protecting the interest of its citizens against these companies. Again I affirm, there is nothing wrong with taxation, but everything may surely go wrong with Liberia’s growth and development, because the government failed to take into account the needs of its citizenry and the long-term effects of taxation policies that cripples access to basic necessities.
Authored By Bill Ivans Gbafore
Featured Picture by FrontpageAfrica
