Countries generally tax the forestry sector to achieve the twin objectives of revenue maximization and sustainability of logging levels. In an ideal world of perfect markets and information, auctions would be the best instrument to determine the price of extraction rights. However, a number of factors-including a lack of information on the forest resources under consideration, uncertainties as to the stability of property rights over time, and a lack of access to credit-have limited the use of auctions so far, particularly in low-income countries. To establish transparency of the forestry sector's financial flows, this paper discusses a radical simplification of Liberia's current timber tax structure, including a proposal to reduce the sector's current tax system to two instruments, an area tax and an export tax.
of a transparent system of revenue collection.
To establish transparency of the sector’s financial flows, Liberia is taking a number of actions with external assistance . To this end, this paper discusses a radical simplification of Liberia’s current timbertaxstructure. The paper proceeds as follows: After a description of the evolution of Liberia’s timber sector and of its tax structure, it provides an overview of the theory of timber taxation. Based on a theoretical model, a range of taxes and fees applied to forestry activities is being evaluated in light of
F. Will Dollarization Help Liberia?
5. Financing of Fiscal Deficits During the 1980s
III. Simplifying Liberia’s TimberTaxStructure—A Contribution to Enhance Revenue Transparency
B. Evolution of Liberia’s Timber Sector
C. Liberia’s Timber Revenue System
D. Principles of Forestry Taxation
E. Simplifying Liberia’s TimberTaxStructure
6. Flow of Timber Through the Forest Sector and Application of Taxes
Statistical Appendix Tables
1. Sectoral Gross Domestic Product, 2000–04
. Trade Regime and Competitiveness
H. Relations with the Fund
I. Data Issues
IV. Staff Appraisal
1. Selected Economic and Financial Indicators, 2001–09
2. Balance of Payments, 2000–09
3. Summary of Central Government Operations, 2001–09
4. Monetary Survey, 2002–09
5. External Public Debt, 2000–04
1. Liberia—A Postconflict Social Assessment
2. Simplifying Liberia’s TimberTaxStructure
3. Liberia—A Case for Dollarization
4. Donor Assistance to Liberia
I. Assessing Debt Sustainability
II. Relations with the Fund
This Selected Issues and Statistical Appendix paper examines recent economic developments and medium-term outlook for Liberia. This paper focuses on economic developments during 2003 and 2004 and the medium-term challenges of reconstruction. The paper explores the pros and cons of adopting full (de jure) dollarization in Liberia. It reviews the theoretical arguments for and against adopting dollarization and the associated empirical evidence. The choices of monetary and exchange rate regimes made by other post-conflict countries are presented. The paper also assesses whether Liberia, in its current post-conflict situation, could benefit from dollarization.
Council has imposed a number of pre-conditions for the lifting of its sanctions. One important condition is the establishment of a transparent system of revenue collection.
50. To establish transparency of the sector’s financial flows, a number of actions are under way, with external assistance . As a contribution to this end, this paper discusses a radical simplification of Liberia’s current timbertaxstructure. The paper proceeds as follows: After a description of the evolution of Liberia’s timber sector and of its tax structure, it provides an overview of the
This 2005 Article IV Consultation highlights that Liberia’s real GDP rebounded in 2004, following a steep decline in the second half of 2003 on account of the hostilities and the imposition of the United Nations ban on timber exports. Prices, particularly of food items, have stabilized as supply constraints eased, and the exchange rate has returned to pre-conflict levels. Official reserves increased modestly from low levels. For 2005, the economic recovery is expected to strengthen, underpinned by continued consolidation of the security situation and reconstruction activities.
problems that had led to shortfalls in some areas . They were dealing with delays in implementing the amended contract with an external agent for preshipment inspections (BIVAC), which caused shortfalls in customs collections. A petroleum importer’s practice to offset petroleum taxes due against the repayment of a loan granted to the previous government has been discontinued. Income tax collections have been stronger than expected as a result of enforced withholding.
Simplifying Liberia’s TimberTaxStructure
Enhanced accountability and transparency of