Speaker Abdoulie Bojang |
Lawmakers in the Gambian capital, Banjul on June 26, 2012
unanimously approve the three Bills: the ECOWAS Value Added Tax (VAT) Protocol, Amendments to the IMF Articles of Agreement,
and the African Legal Support Facility (ALSF).
The three international legal instruments were tabled by
the Minister of Finance and Economic Affairs, Mr. Abdou Kolley, before the
National Assembly in its Second Meeting of the 2012 Legislative Year.
Speaking on the VAT, Mr. Kolley said the Authority of
Heads of State and Government of Economic Community of West African States
(ECOWAS), signed the Value Added Tax (VAT) Protocol A/P2/7/96 in Abuja, Nigeria
in July 1996.
Member States are obliged to adopt the VAT Protocol as
part of efforts to harmonize indirect tax legislations and policies to
encourage increased intra-community trade on a non-discriminatory basis.
Before Tuesday’s approval, The Gambia and Guinea Bissau
were the only countries yet to introduce the VAT, compelling the sub-regional
economic bloc to issue a Ministerial Directive in 2009 to provide technical and
financial support to the two non-VAT compliant countries to enable them
accelerate the rate of ratification and implementation.
“The protocol
provides guidance for the legal and administrative design of VAT within the
Sub-region, and shall be a general consumption tax to replace the other
indirect taxes charged on turnover such as sales tax,” Minister Kolley
explains.
He said it will target economic activities supplied for consideration
unless they are exempted from the VAT base, for instance - salaried activities.
Some of the exemptions are aimed at ensuring that the VAT
limits its scope to consumption taking place in a country, an important design
feature of the tax in all jurisdictions where it is applied.
The Protocol gives guidance in the determination of the
VAT-base for both import and domestic transactions. It also address the importance
in forecasting the revenue yield of the VAT compared to the sales tax which it
has replaced in all the countries.
According to the Minister, the charges for the VAT will
begin from January 1, 2013. The government has already incorporated the
relevant provisions of the Protocol into the Income and Value Added Tax Bill,
2012.
Speaking on the Amendments
to the IMF Articles of Agreement, Mr. Kolley noted that for the past
few years, the International Monetary Fund (IMF) has been engaged in a review
of its governance structures; with a view to make the institution more
representative of current realities.
These reforms have focused on two main areas: A General
Revision of Quotas; and Reform of the Executive Board. The former was the first to be completed and was earlier
presented to Cabinet and subsequently ratified by the National Assembly in
2010, he said.
In December 2010, the IMF approved the proposed
amendments to the reform of the Executive Board, which are now being submitted
to parliament for approval, he added.
The reform of the Executive Board can only be fully
implemented in accordance with Article XXVIII and the terms of Board Resolution
No.66-2, when three-fifths of Members States, having 85% of the total voting
power, ratify and accept the proposed Amendments on the Reform of the Executive
Board.
According to Mr. Kolley, as of April 4 this year 68
members countries with a total voting power of 45.96% ratified the proposed
Amendments to the Articles of Agreement, including 15 amendment proposals put
forward to be ratified by member countries, The Gambia among them.
The proposed amendments include: Increasing the number of
Executive Directors on the Executive Board; election procedures of Executive
Directors; terms of office of executive directors (election intervals, voting
powers of the Executive Directors, members or group of members and number of
votes allotted to members or group of members).
He said proposed amendments to the Articles of Agreement
will increase the voting and representation of the Constituency in the
Executive Board of the IMF through provision of a Second Alternate Executive
Director, among others.
The African
Legal Support Facility (ALSF)
was also ratified last Tuesday.
It was established in 2008 by the African Development Bank
(AfDB) as an international legal institution to: Provide legal advice and
services to African countries in creditor litigation; Provide technical legal
assistance to African countries to strengthen their expertise and negotiating
capacity in matters pertaining to debt management and litigation, natural
resources and extractive industries management and contracting , investment
agreements, and related commercial and business transactions, as the case may
be; and Strengthen process in African countries.
On May 15, 2012, the Government of the Gambia signed the
agreement establishing the ALSF. The Minister said its ratification would make the
country a full member and will be eligible for technical and financial support
in public-private partnership arrangements and structuring of complex financial
deals financed by the Facility.
Though membership to the ALSF is open to all sovereign
nations, the AfDB, and other international organisations, only 42 member
countries and three international organisations have sign to the Treaty establishing
it.
It has been fully operational and is actively recruiting
additional members and support for its operations, Mr. Kolley said. The ALSF is
supported by voluntary contributions, allocations of net income from the AfDB
and income accruing from the ALSF’s endowment fund.
An initial sum of $16 million was contributed by the AfDB
to help establish the ALS Facility, the minister revealed. The ALSF is hosted
by the AFDB, but operates independently and maintains the same privileges and
immunities enjoyed by other international organisations.
Source: The Voice
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