Budget Advocacy Network (BAN) yesterday revealed in a new transfer pricing report titled "Are We getting the right prices and returns from our wealth?" that about US$83.7m was forfeited as corporate tax between 2004 and 2014 through mis-invoicing in Sierra Leone.
The report, which was launched yesterday at Hill Valley Hotel on Signal Hill Road, west of Freetown, states that during the iron ore boom, beginning 2011, revenue loss from such practices increased from as low as U$$14.1m to US$205.95m between 2010 and 2013.
The report went further to state that between 2013 and 2015 a total of US$3.69m was lost as a result of mis-pricing of iron ore sales, while the sum of US$1.28m was also lost in Bauxite trade due to the same practice.
It added that in 2015, mis pricing in Rutile trade resulted in a loss of US$0.773m in respect of royalty payment.
The report explains that US$3.96m loss in respect of mis -pricing of iron ore could be translated in terms of development as five times the cost of procuring textbooks and teaching materials for all pre-primary and primary schools in 2015, amongst other social needs.
Speaking during the launch of the report, Andrew Lavali, from the Institute of Governance Reform (IGR), said economic governance remains a real challenge in Sierra Leone, adding that in 2013 BAN conducted a study which reported that about US$244m was lost through duty waivers.
"This report is really mindboggling. So, we have to go beyond research and recommendations and start putting work into reality," Mr. Lavali urged.
He noted that the country was losing both at the front-end and back-end, adding that only 5% of illicit financial flows stay in Africa, hence the need for more engagement.
Mr. Lavali said the Citizens' Manifesto is very important as it demands from political leaders who want to lead citizens in 2018 to declare their assets and be accountable, adding that the move would help stimulate economic growth in the country.
Open Society Initiative for West Africa (OSIWA) Country Director, Joe Pemagbi, applauded BAN for taking up the research work ,thus asking a rhetorical question that: "Are we still having value for our money? We only need to drive through Koidu,Bomabali and Lunsar and you will see whether we are having value for our money?"
"The report is here, what next; what can we do as citizens of this country?" he questioned.
He said the country doesn't lack frameworks for transparency and accountability but needed constructive dialogue among the citizenry to owning the process and assured of OSIWA's continuous support to BAN, government and non -state actors in Sierra Leone.
Mohamed Foday, Assistant Director Monitoring, Research and Planning at the National Revenue Authority, said they were concerned as to the issues raised in the report, adding that they have set-up a specialised audit system for mining and telecommunications industries in the country.
"Through IMF, we have started training our workers on specialised auditing," he said and assured BAN that the revenue authority would reflect on the findings and recommendations.
He reiterated NRA'S role of assessing, collecting domestic taxes and non-tax revenues in the country, thus encouraging all sectors in revenue generation to work together in alleviating price manipulation in Sierra Leone.
He revealed that NRA has the complete data on duty waivers from 2005 to date, adding that they had helped BAN with their data collection whenever they had been approached.
Dr. Shaka Bangura, an official at the Sustainable Development (SDG) Secretariat, Ministry of Finance and Economic Development (MOFED), said the issue of illicit financial flows has far-reaching implications on the country's development.
"The loss to illicit financial flows is around 50-60 billion United States dollars, according to a panel headed by Thabo Mbeki, former South African President," he said.
He stressed the need for more internal revenue collection and generation, adding conceding that debates, engagements and discussions were critical to helping solve economic problems in the country.
He suggested that a national tax action forum be conveyed where discussions could be sustained around the economic development of the nation. He also assured of government's commitment to achieving the sustainable development goals through the Agenda for Prosperity.