Liberia

Scope of GST

Imposition of goods and services tax (GST)

Goods and services tax (GST) is imposed on:

• every taxable supply of goods by a registered manufacturer

• every taxable import of goods

• every supply of taxable services in Liberia by a registered services provider.

Person liable for GST

• Goods tax payable on taxable supply of goods is to be accounted for by the registered manufacturer.

• Goods tax payable on taxable importation of goods is to be paid by the importer, unless the importer is a registered manufacturer and the import is used to produce the registered person’s manufactured goods.

• Service tax payable on a supply of taxable services is to be accounted for by the registered service provider making the supply.

Recoverability of GST

Taxable supply

Definition of taxable supply

Goods tax

Services tax

Taxable services include:

• electricity services

• telecommunications services

• provision of water for a fee

• hotel services (including board, lodging, restaurant meals, beverages)

• restaurant services (including supply of meals and beverages) and take-away meals supplied by a café, supermarket or similar facility

• gambling services

• sale of tickets by an international transport service

• services of a travel agent or travel arranger, including issuing tickets

• other services (including port-related services, courier services, air travel, vehicle rental services, automobile repairs and services, and professional services).

GST rates

Aside from telecommunications services, the general GST rate for all taxable goods and services and on taxable imports is 10%.

Telecommunications services attract a surcharge of 5% making the total GST 15%.

Goods exported attract 0% GST.

GST registration

Compulsory registration

Any person who carries on any business of manufacturing or business of providing taxable services has an obligation to register as follows:

• at the end of any 12-month period where taxable supplies or services totalling LIB$3m was made, or

• at the beginning of any twelve months period where there are reasonable grounds to expect that taxable supplies or services totalling LIB$3m or more will be made.

Any person having an obligation to register per the above qualification shall apply to be registered within 21 days of becoming obliged to register.

Voluntary registration

Group registration

Deregistration

Goods tax

A registered manufacturer shall apply in writing to the Commissioner-General for cancellation of the person’s registration if they cease to make taxable supplies or if the value of their taxable supplies during the last 12-months does not exceed LIB$3m.

Application for deregistration can only be made after the expiration of two years from the date of registration.

Services tax

A registered services provider shall apply in writing to the Commissioner-General for cancellation of their registration if they cease to be required to be registered under the Tax Code.

Input GST deduction

Input tax allowed

Input tax expressly denied

Partial exemption

Change-of-use adjustments

Preregistration or post-deregistration GST

Non-residents

Output GST

Brief description of output GST

The GST rate is applied on the taxable amount of the taxable supply. The taxable amount is generally the consideration paid/payable for the supply.

Output GST charged is fully remitted to the tax authority by the due date. An input deduction is not allowed.

Exempt supplies

Exempt supplies are as follows:

• supply of foodstuffs for human consumption (but not when served as a meal or as cooked or prepared food), for the general use of educational, and philanthropic institutions

• a supply of goods for the relief of distressed persons in the case of natural disasters or other humanitarian emergencies

• a supply of a pharmaceutical or medicinal preparation shall be specified by regulation to be issued by the minister

• a supply of medical aids or appliances specifically designed for persons with an illness or disability shall be specified by regulation by the minister

• a supply of textbooks or other instructional materials designed for use in schools or adult education programmes, including items specified in regulations

• supply of raw materials to a registered manufacturer, a renewable resource producer, a mining project producer or a petroleum project producer

• supply of goods as part of the transfer of a manufacturing business as a going concern by a registered manufacturer to another registered manufacturer

• supply of medical and educational equipment and supplies purchased for use directly in or in connection with a renewable resource contract, mining project production and petroleum project production and intended to be placed in service within one year of purchase.

Zero-rated supplies

Special rated supplies

Advertising prices

International trade

Imports

Goods

GST applies at a rate of 10% on all imported goods to the extent that the goods will be subject to GST if they were supplied in Liberia, i.e. manufactured in Liberia.

Services

There is no GST on imported services.

Exports

Goods

Export of goods attracts 0% GST.

Export of goods means the delivery of goods to, or the making available of the goods at, an address outside Liberia for use or consumption outside Liberia as evidenced by documentary proof.

Services

Services attract 10% GST except electricity and telecommunications services. Electricity and telecommunications services attract GST if they are received in Liberia.

Place, time and value of supplies

Place of supply

Goods tax

The place of supply for goods:

• occurs at the place where the goods are delivered or made available by the supplier

• if the delivery or making available involves transportation, the place where the goods are when the transportation commences.

Services tax

The general provision is that a supply of taxable services occurs at the place of business from which the services are provided.

For electricity or telecommunications services, a supply of electricity or telecommunications services occurs at the location where the services are received.

Time of supply

Goods tax

Generally, time of supply occurs at the earlier of:

• the date on which the goods tax invoice for the supply is issued, or

• the date on which the goods tax invoice is required to be issued (earlier of date of payment, date of delivery or date of shipment).

Services tax

Generally, time of supply occurs at the earlier of:

• the date on which the services tax invoice for the supply is issued, or

• the date on which the services tax invoice for the supply is required to be issued (i.e. within ten days of performing the services).

Value of supply

Goods tax

In general, the value of the supply of goods is the consideration payable for the supply.

The value of supply for hire purchase agreement, finance lease, application of goods for own use, and related-party transactions is the fair market value.

No consideration

Where the supply is made for no consideration the value of supply is zero except in a related-party transaction.

Imported goods

The value of the supply for imported goods is the sum of the following:

• the CIF (cost, insurance and freight), Liberian Port or Customs entry value, whichever is applicable

• the value of incidental services

• the customs duty, customs service fee, Economic Community of West African States (ECOWAS) Trade Levy, and excise tax (if any) on import.

Services tax

In general, the value of the supply of services is the consideration payable for the supply.

The value of supply for related-party transactions is the fair market value.

No consideration

• Where the supply is made for no consideration the value of supply is zero except in a related-party transaction.

GST compliance

Accounting basis and tax period

Returns and payment of GST

Goods tax

Every registered manufacturer shall file a goods tax return for each tax period within 21 days after the end of the period, whether or not any goods tax is due for the period. Goods tax payable is due on the date that the goods tax return for that period is due.

In respect of taxable imports, the goods tax payable by an importer in respect of a taxable import is due on the date of arrival of the import at the port of entry, and is collected at the same time and subject to the same conditions as collection of customs duties under the External Tariff Law.

Services tax

Every registered services provider shall file a services tax return for each tax period within 21 days after the end of the period, whether or not any services tax is due for such period.

Interest and penalties

There is a comprehensive system of penalties and interest payable for:

• failure to register

• late filing

• failure to file

• failure to pay on time

• failure to pay correct amount.

Refunds

Objections and appeals

A taxpayer has a right to object a determination (or assessment) made by the tax authority.

If the objection is unsuccessful, then the taxpayer may appeal the determination to the Board of Tax Appeals (BoTA).

In order to make an appeal to the BoTA, the taxpayer must submit a written request for a hearing stating briefly the basis of the appeal. Within 30 days of making the request, the taxpayer must submit a written protest (objection) containing an explanation of the issues to be heard. The hearing by BoTA must be made within six months after the date of the taxpayer’s request for hearing.

If the taxpayer is not satisfied with the decision of the BoTA, they may appeal the decision to the court.

Time limits

An appeal to the Board of Tax Appeals must be made within 30 days after the date of the notice of determination.

Appeals to the courts must be made within 30 days after the decision of the Board of Tax Appeals.

Withholding GST

Appointment of withholding GST agents

Withholding GST exemption

Withholding compliance

GST refunds

GST records

Tax invoices

Every registered manufacturer or service provider making a taxable supply shall provide the customer with a tax invoice for the supply.

The tax invoice shall have the following particulars:

• the words ‘goods tax invoice’ or ‘services tax invoice’ in a prominent place

• the name, address, and taxpayer identification number of the registered manufacturer/service provider making the supply

• the individualised serial number and the date on which the goods/services tax invoice is issued

• the description of the goods/services supplied (including quantity or volume) and the date on which the goods were delivered

• the consideration for the supply and the amount of the GST charged.

Tax invoices are self-generated by the registered manufacturer or service provider.

Credit notes and debit notes

The law allows for debit notes and credit notes to be issued to the recipient in respect of goods tax in the event the goods are seized by the tax authority if the tax revenue is at risk.

In addition to the above, in practice, credit and debit notes may be issued in the following events:

• taxable supply is cancelled

• the nature of a taxable supply has been fundamentally varied or altered

• the consideration for a taxable supply by a registered manufacturer is altered

• the goods (or part thereof) that are the subject of a taxable supply by a registered manufacturer are returned to the manufacture.

Additional export documentation

Record-keeping

There are no record-keeping rules for GST compliance.

However, a taxpayer is generally required to maintain in Liberia, in the English language, books and records adequate to substantiate the tax due and is required to produce them upon request.

Records to be kept generally include GST invoices, bank statements, credit notes, debit notes, customs documentation relating to imports or exports, accounting and other financial information etc.

Specific GST rules

Bad debts

There are no specific provisions on bad debts.

However, if a taxable supply is cancelled (which may occur in the event of bad debts), the taxable person is granted a credit for the GST on the taxable supply cancelled. The credit is allowed in the tax period in which the cancellation occurred.

Digital economy

Land and buildings

Leasing

Leases are treated as the supply of goods.

Finance leases are valued for GST purposes at the fair market value at the time of the supply. Time of supply is the date on which the lease agreement commences.

Promotional gifts

Generally promotional gifts are valued at no consideration.

Secondhand goods

Not applicable. Goods tax applies only on goods manufactured in Liberia.

Tourism industry

Certain services in the tourism industry are subject to GST. These are:

• services supplied in carrying on the business of a hotel or similar facility (including board, lodging, and incidental services), and restaurant meals, beverages, and other services supplied on the premises of a hotel

• services supplied in carrying on the business of a restaurant or café (including supplies of meals or beverages), and supplies of take-away meals by a restaurant, café, supermarket or similar supplier.

Currency conversion

Transfer of business

A supply of goods as part of the transfer of a manufacturing business as a going concern by a registered manufacturer to another registered manufacturer is exempt from GST.

A registered manufacturer means any person who is registered or required to be registered for GST in Liberia.

Warranty repairs

Not applicable unless it involves a supply of goods by a registered manufacturer.

Other indirect taxes

Import duties

Excise duties

Excise duty is imposed on the production of excisable goods in Liberia, importation of excisable goods into Liberia and the provision of excisable services in Liberia.

Specific rates

There is a fixed amount based on a specific unit of measurement in the excisable good.

Ad valorem

Ad valorem is expressed as a percentage of the taxable value. The taxable base for domestic excisable goods is determined as the greater of the ex-factory price or the normal selling price excluding GST.

For imported excisable products, the taxable base is determined as the sum of the CIF, import duty, customs service charge, ECOWAS Levy and any other duties except GST.

Exports of excisable products are taxed at a zero rate.

Excisable goods generally include:

• alcoholic and non-alcoholic beverages

• tobacco and tobacco products

• luxury goods

• cosmetics

• sugar

• gambling equipment.

Returns

Payment of tax

Domestic goods

Imported goods

Stamp duty