Integrity Watch Liberia (IWL) has raised concerns that the Government’s proposed US$1.539 billion national budget for Fiscal Year 2027 could impose additional financial pressure on poor households, market women and small businesses amid plans to increase tax revenue by 42.5 percent.
In a critical assessment of the draft budget, the anti-corruption and fiscal accountability organization warned that while the Government’s revenue mobilization ambitions are necessary to finance national development, the proposed measures lack sufficient publicly identifiable safeguards to demonstrate how vulnerable citizens will be protected.
According to IWL’s assessment, projected tax revenue is expected to rise from approximately US$752.72 million in the FY2026 approved budget to US$1.072 billion in FY2027, representing an increase of approximately US$319.8 million.
The projection has prompted the organization to question who will ultimately bear the financial burden of generating the additional revenue.
IWL acknowledged the importance of
strengthening domestic revenue collection but cautioned that the Government must demonstrate whether the projected increase will come primarily from improved compliance among large taxpayers, reduced revenue leakages and better management of tax incentives, rather than placing additional pressure on ordinary consumers and small businesses.
The proposed revenue measures include the transition from Goods and Services Tax (GST) to Value Added Tax (VAT), a minimum excise on digital financial services, property valuation reforms and enhanced electronic tax invoicing and customs controls.
IWL warned that these measures could have unintended consequences for women engaged in small-scale trading, informal businesses and agricultural activities, particularly if additional transaction costs and higher prices erode their already limited profit margins.
The organization also expressed concern over projected international trade tax revenue, which is expected to increase by approximately 49.4 percent, from US$280.77 million in FY2026 to US$419.39 million in FY2027.
Given Liberia’s dependence on imported goods, IWL cautioned that additional import-related costs could be passed on to consumers, potentially increasing the financial burden on low-income households.
Beyond taxation, the assessment exposed significant gaps in the Government’s gender-responsive budgeting commitments.
Although the proposed allocation to the Ministry of Gender, Children and Social Protection has increased from US$4.06 million to approximately US$7.09 million, the amount represents only about 0.46 percent of the proposed national budget.
IWL welcomed the increase but challenged the Government to demonstrate how the funding would translate into direct services for vulnerable women and children, particularly in preventing sexual and gender-based violence, supporting survivors and strengthening child protection systems.
The organization also disclosed that only 13 of the 122 government spending entities submitted gender-responsive budget statements for FY2027, representing approximately 11 percent of the institutions covered by the proposed budget.
It argued that gender-responsive budgeting must extend beyond the Ministry of Gender and traditional social sectors to include agriculture, infrastructure, taxation, natural resource governance and other areas of government operations.
With the proposed budget now subject to legislative scrutiny, IWL has called on the National Legislature to demand a detailed explanation of the projected 42.5 percent increase in tax revenue and require a comprehensive assessment of how the proposed tax reforms could affect women, low-income households and small businesses.
The organization is also urging lawmakers to conduct dedicated gender-responsive budget hearings, scrutinize tax incentives and concessions, and strengthen oversight of public expenditure.
Among its recommendations, IWL wants the Government to prioritize revenue collection from large taxpayers, address tax-related leakages, protect affordable access to digital financial services and introduce stronger safeguards for micro and small businesses.
It further called for mandatory gender-responsive budgeting across government institutions and regular public reporting on how allocated resources are spent and the actual benefits delivered to citizens.
IWL maintained that the success of the FY2027 budget should not be measured solely by the amount of revenue the Government expects to collect, but also by how fairly the tax burden is distributed and whether public resources translate into meaningful improvements in people’s lives.
