The_Open_Door_deel1

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•• \ During the 1950 's the Government engaged in road building
,:;j activities, the construction of public buildings, and the
|j improvement of communication facilities. These were mainly
Ij financed with loans granted by the contractors. Simultaneously,
Ij an increased effort was made to provide more educational
Ij opportunities and medical facilities to more people and to improve
|j the sanitary situation in the capital. These expenditures were
|j generally financed from current revenues supplemented with funds
obtained from the U.S.A. under the Nine-Year Development Plan.
The general administration of the country's affairs each year
needed higher amounts as the existing Departments were expanded
and new ones were created. Unrestricted use of these prefinanced
loans, unwise spending, an over-optimistic anticipation of future
revenues, and a drop in commodity prices, in the early 196O's all
contributed to a financial crisis which was unprecedented in the
history of the country. The chaotic public finance administration
which prevented a proper fiscal planning as well as proper tax
collection made the situation unnecessarily bad. In March 1952
the Legislature had passed a law introducing another per capita
tax, a Relief Tax of $ 1.00 annually on every citizen between the
ages of 21 and 60 (35). However, six years later the Treasury
Department reported that this law had never been enforced owing
to the fact that the Bureau of Internal Revenue (the collecting
agency) had never received a copy of this Bill (36). A Mercantile
Gains Tax and Excise Tax, introduced in 1945 and 194-6 respectively,
had been ineffective in the absence of a reporting system by
which to check on the merchant-importers' accounts (37).
Even in the early 196o's the Bureau of Internal Revenue of the
Treasury Department did not have a master checklist of
concessions which offered the necessary information regarding
these foreign companies' tax liability and tax exemptions.
Despite the existence of a Board of Concessions (created in
1953) no list existed of all concessions in the country, neither
had any Government agency ever compiled aij.1 the concession
agreements (38). In general the enforcement of general tax laws
or of fiscal provisions of these concession agreements was not
systematic, coordinated or complete. Despite this general lack
of knowledge as to who were entitled to e.g. duty free
privileges, abuses of duty exemptions by both concessionaires
and others were reported in 1958 (39). The creation of a
commission for the control of duty free privileges did not
produce the satisfactory results in this case either.
Tax evasion by Liberian citizens (both Hut Tax and Real Estate
Tax) and by Lebanese merchants occurred on a large scale and
deprived the Treasury of large sums of money (40). The report of
a Tax Planning and Coordination Committee mentioned in i960 that
lawyers and law firms of high standing, including high ranking
government officials, were actively engaged in tax-evading
practices. In vain it was recommended that legislation should be
passed prohibiting lawyers on Government Payrolls from
representing their clients involved in tax cases (41). In the
same year the Secretary to the Treasury complained that