National budget: Parliament put forward 6 Trillion Leones for 2018

By Mohamed Konneh

The Minister of Finance and Economic Development, Mr. Momodu Kargbo will present the 2018 National budget at the well of Parliament today Friday 27th October 2017.  The budget which is the second most important document contained proposed figures for the 2018 fiscal year.

The projected amount for 2018 is Six Trillion Three Hundred and Thirty Six Billion Seven Hundred and Seven Million Five Hundred and Twenty Two Thousand Leones that shall be and is hereby granted to the president for and during the year 2018 to be applied and expended.

During the policy hearing and budget discussion in August this year Minister Momodu Kargbo said the Country needs around four trillion Leones to finance its annual budget. The Ministry of Finance he said is constraints with allocation and anything below four trillion will constrained the ministry and that much development activities will not be possible.

Mr. Kargbo said “Sierra Leone had a terrible experience during the Ebola and that the economy contract by 25 percent. Some economies would have collapsed if they had contract by 25 percent. But we were able to cope by providing basic services. The micro economy is improving that is why we are where we are today. The economy started picking up in 2016 and growth has been estimated at six percent”.

Below is the 2018 budget summary:

Public Debt


  • Interest costs are estimated to increase from about Le 180.0 billion in 2016 to about Le 474.0 billion in 2017. To minimize this interest burden and roll-over risk, Government will issue medium term Treasury Bonds during 2017


Improving Access to Finance for Sierra Leonean Businesses

  • Government recognizes that limited access to affordable finance remains a major constraint to SME development. To address this, the Bank of Sierra Leone is piloting a number of Bills, including the Securities Bill; Collective Investment Bill; and Credit Administration and Debt Recovery Bill. These Bills, when enacted, will facilitate increased access to finance for Sierra Leonean businesses, as well as deepen the financial sector


Improving the Business Climate

  • Ongoing reforms by the Bank of Sierra Leone, in particular, the introduction of the National Switch and the Single Window Initiative at the Port will no doubt contribute to improving the business climate.





Diversifying the Economy and Improving Resilience

  • improve agricultural productivity and give prominence to value-chain development by enhancing processing and marketing capabilities


  • connect small scale rural farmers to established agri-businesses,


  • Exploit the enormous value-addition potential in cassava for flour and bread making and export opportunities.


  • Operationalize the large belt for onion production in Loko Masama, Kamakwie, Kamalo, Makeni and Kabala


  • Support will also be provided to small-scale farmers to increase yields of groundnut and soya beans to produce cooking oil.





Diversifying the Economy and Improving Resilience

  • The establishment of a national fish harbour and complex to boost industrial fish production will be seriously pursued.


  • Provide support to enhance monitoring and surveillance of our Exclusive Economic Zone




Diversifying the Economy and Improving Resilience

  • Construct a National Arts Gallery and fast-track the completion of the new Cultural Village at Mabela in the Western Area.
  • supporting the development of the Tiwai Resort, Chimpanzee Sanctuary, Bunce Island as well as Monument and Relics.

National Public Procurement Authority



Empowering the People-Fostering Entrepreneurship

  • All MDAs will now buy furniture made in Sierra Leone.
  • In general, window curtains, table cloth, chair backs in Government
  • offices will now be made of gara.
  • In all public events – trainings, seminars, workshops and meetings funded from the Consolidated Revenue Fund, “Made in Sierra Leone” alcoholic beverages, soft drinks, juices, including tombee juice, ginger beer, lemon grass tea, bissap, moringa and water processed and bottled in Sierra Leone should be served.
  • 10 percent of the rice required for institutional feeding from local suppliers to create a ready market for smallholder farmers.



  • updating the Public Procurement Regulations and harmonizing Standard Bidding Documents and Procurement Manuals to reflect the new law.
  • All Procurement Officers and Internal Auditors should henceforth produce quarterly reports of ongoing procurement activities in their respective MDAs.
  • The NPPA will also be publishing quarterly price norms to ensure uniformity and standardized prices for common user items to ensure value for money.
  • Price norms will also be published for specialized items.
  • Government in collaboration with Development Partners will also introduce E-Procurement to improve transparency and accountability in the procurement process



Ministry of Finance and Economic Development


Support to Small and Medium-Sized Enterprises (SMEs)

  • Government, in collaboration with Development Partners, will provide through the SME Fund, an amount of US$ 4.9 million to support Sierra Leoneans develop their own businesses. An amount of US$350,000 will be allocated to SMEs development activities in each of the 14 districts


Financial Accounting, Recording and Reporting

  • Expenditure Monitoring and Accountability Unit will be created within my Ministry. The Unit will with sector ministries in undertaking expenditure analysis and produce performance reports on service delivery that link inputs (tracking of expenditure) and outputs (execution of contracts, quality of deliverables). A key objective of this initiative is to institutionalize expenditure tracking, service delivery impact assessment and general accountability of public spending on a sustained basis.


New Vehicle Policy

  • To control this cost and the abuse of official vehicles, MOFED, the Ministry of Transport and Aviation and the Assets and Properties Commission will develop a proposal for allocation of official vehicles for Cabinet approval


The Challenges of Financing Infrastructure Projects

  • Government hereby establishes an Infrastructure Development and Investment Fund. This will be funded from levies, fees and other charges. In the meantime, Government has allocated Le 21.00 billion to kick-start the Fund

National Revenue Authority

Improving the Business Climate

  • Implement business regulatory reforms to facilitate electronic payment of taxes and fees, and speedy clearance of goods at the Port.

Revenue projections

  • In 2017, domestic revenue is projected to increase to Le 3.6 trillion (11.8 percent of GDP) from Le 2.8 trillion (10.5 percent of GDP) in 2016.


Revenue Proposals

(i) Increase tariff rate on imports of cigarettes and tobacco products from 10 percent to 20 percent on Cost, Insurance and Freight (CIF) value;


(ii) Re-introduce an excise tax on cigarette and tobacco products at 35 percent;


(iii) Introduce a royalty charge of 0.5 percent on turnover of every company

or taxable person providing telecommunication services;


(iv) Revise the presumptive income tax rates for commercial vehicles and

motor bikes operators;


(v) Revise the presumptive income tax regime for alluvial gold and diamond

mining activities;


(vi) Increase the payroll tax for ECOWAS citizens from Le 500,000 to Le1.5

million and non-ECOWAS citizens from Le 3 million to Le 5 million;


(vii) Increase the annual license fees for all businesses engaged in gaming

and betting activities from US$ 30,000 to US$ 50,000;


(viii) Introduce an excise duty of 20 percent on sales of gaming and betting

tickets and stakes;


(ix) Increase the tariff rate on import of water from 20 percent to 35 percent

on CIF value;


(x) Increase the tariff rate on import of soft drinks, juices and juice drinks

to 35 percent on CIF value;


(xi) Increase the tariff rate on imported wheat flour from 10 percent to 35



(xii) Revise customs tariff rate for raw and packaging materials to 3



(xiii) Introduce an Africa Union levy of 0.2 percent on CIF value of all imports;


(xiv) Implement fully the ECOWAS Common External Tariff (CET) rates


(xv) Remittance of PAYE of expatriate staff in foreign currency to the

Consolidated Revenue Fund;


(xvi) All Non-Governmental Organizations (NGOs) are required to pay import

duty on their imports into an Escrow Account which can be reclaimed;


to strengthen compliance and administrative efficiency, the 2017

Finance Bill also addresses the following:


(i) It limits income tax loss carry forward to 10 years;


(ii) It clarifies and broadens the definition of chargeable assets for purposes of determining when and how Capital Gains Tax applies;


(iii) It strengthens and removes inconsistencies from procedures relating to

filing of income tax returns;


(iv) It clarifies and streamlines procedures for distress proceedings and

installment of income tax;


(v) It provides more specific definitions of GST exempt supplies for ease of

administration; and


(vi) It strengthens procedures for customs control zones.


Key reforms include:


(i) the establishment of a centralised debt management

and compliance unit;


(ii) Migration from ASYCUDA++ to ASYCUDA World;


(iii) Development of a revenue accounting and reconciliation system;


(iv) Improvement in customs valuation by updating the Price Reference Database (PRD) with original price data from the Cargo Tracking Company;


(v) Full utilisation of mobile scanners for nonintrusive methods of import examination;


(vi) Establishment and operationalisation of an Integrated Tax Administration  System (ITAS); and (vii) Procurement and installation of electronic cash registers for GST administration.


Ministry of Transport and Aviation

Expanding the Social Safety Net

  • To ease transportation problems for our people, Government will provide an

additional 100 buses during 2017.


Local Government Finance Department – MOFED

Expanding the Social Safety Net

  • To support these programmes, subsidies and transfers will increase from Le 341.4 billion in 2016 to Le 514.2 billion in 2017.


Fiscal Decentralisation

  • Local Councils will be required to implement the Property Cadastre system to facilitate the collection of Property Tax from 2017 onwards, to enable them gradually reduce their reliance on Central Government transfers.



Accountant General Department

Financial Accounting, Recording and Reporting

  • IFMIS has been successfully rolled out to 30 MDAs and will be further rolled out to an additional 24 MDAs during 2017.



Wages and Salaries

  • Wages and Salaries are projected to increase marginally to Le1.81 trillion (5.9 percent of GDP) in 2017 from Le 1.79 trillion in 2016. The increase of Le10.0 billion will finance new authorized recruitments in the civil service.


  • For equity, the payment of all annual leave allowances for public sector workers is harmonized to one-month gross salary. Annual rent allowances will also not exceed 10 percent of annual gross salary for all public sector workers including staff of all sub-vented agencies effective 2017.


  • Total public debt service payments are projected at Le 846.9 billion in 2017

compared to Le 426.5 billion in 2016.



Ministry of Transport and Aviation

New Vehicle Policy

  • To control this cost and the abuse of official vehicles, MOFED, the Ministry of Transport and Aviation and the Assets and Properties Commission will develop a proposal for allocation of official vehicles for Cabinet approval


Ministry of Works, Housing and Infrastructure

Addressing Infrastructure Bottlenecks

  • Ongoing programmes for the construction and rehabilitation of trunk roads across the country will be given high priority. These include the Bo – Bandajuma Road and the Pendembu to Kailahun road.


  • The Kuwait Fund for Development has approved US$20.0 million for the completion of phase II of the Hill Side By-Pass Road


Ministry of Energy

Addressing Infrastructure Bottlenecks

  • With the support of our Development Partners, we will increase power generation, strengthen and expand the transmission and distribution network, particularly in Freetown and other provincial cities


  • Government secured a loan of US$78.0 million from the Indian Exim Bank for the construction of a transmission line from Bumbuna to Waterloo.
  • Government is committing an amount of Le375.0 billion to finance the Rural Electrification Project in the next three years, 2017-2019.


  • In addition, the Governments of Sierra Leone, Guinea, Liberia and Cote d’Ivoire, will commence the construction of 1,525 kilometers of transmission line under the West Africa Power Pool (WAPP) Project in 2017


Budget Bureau- MOFED

Government Spending and Revenues for 2017

  • Total projected resources (domestic revenue and grants) for the Financial Year 2017 is Le 4.8 trillion (15.8 percent of GDP) compared to Le 4.0 trillion (15.1 percent of GDP) in 2016, a net increase of about Le 780.1 billion. Of this, Domestic revenue is Le 3.6 trillion, and Grants, Le 957.0 billion.


Total Expenditure and NetLending is projected at Le 5.4 trillion (17.8 percent of GDP) compared to Le 4.8 trillion (17.9 percent of GDP) in 2016. It is important to note that, about 94 percent of the projected additional resources of Le 780.1 billion will be utilized to finance key statutory expenditures, including activities of the National Electoral Commission (NEC) for the 2018 General Elections; the National Civil Registration Authority; the Post-Ebola Presidential Recovery Priorities; and Debt Service payments. On this basis, the allocations for Goods and Services for all MDAs have been broadly maintained at their 2016 budget levels.

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