Freetown, SIERRA LEONE – In a significant move towards bolstering tax administration and compliance, the government of Sierra Leone is gearing up to introduce Digital Excise Tax Stamps, set to take effect on October 1, 2023. This innovative initiative, a collaborative effort between the Ministry of Finance and the National Revenue Authority (NRA), aims to streamline the verification, tracking, and modification of excisable goods while combatting illicit trade and securing government excise revenues.
Digital Excise Tax Stamps, much more than just markings on products or packaging, feature advanced security measures and codes designed to thwart counterfeiting while facilitating comprehensive track and trace capabilities. These stamps represent a fundamental shift in how the government manages excise taxes.
Minister of Finance, Sheku F. Bangura, expressed the urgent need for this digital transformation, citing persistent challenges in Excise Duty collection, including illicit trade, under-declaration, and monitoring inefficiencies. “This has resulted in a loss of government revenue and created unfair competition for legitimate, law-abiding manufacturers and importers,” Minister Bangura stated.
“The use of a digital traceability solution that enables the authentication of secure tax stamps will aid the government’s tax administration in mitigating these revenue losses and as well as protect compliant companies’ products in the market” he added.
The introduction of Digital Tax Stamps is in accordance with the provisions of Section 37 of the Finance Act 2019. As of January 1, 2024, all manufacturers and importers of gazetted goods, including tobacco products, wines, spirituous beverages, and beers, will be required to affix digitally traceable tax stamps to their products.
Furthermore, the Ministry advised that any stock of gazetted excisable products held before this deadline, without a Digital Tax Stamp, should be returned to the manufacturer or importer for the necessary stamping.
For locally manufactured goods, affixation of tax stamps will occur immediately after packaging at the production facility. In the case of imported goods, affixation will take place at a location registered by the NRA Commissioner General, within seven days of customs clearance or at the production facility within the exporting country, subject to specified conditions set by the Commissioner General.
The introduction of Digital Tax Stamps serves multiple vital purposes, including safeguarding government revenues, combating illicit trade, promoting fair competition in the market, and providing real-time statistical data for tax policy analysis and improved supply chain auditing. ZIJ/13/9/2023