- The government of Somaliland has announced the introduction of a 2% tax increase so as to raise funds for the displaced Somaliland citizens in the country’s Sool region.
Somaliland President Dahir Riyale Kahin decreed that supporting the displaced citizens of Las Anod town is the responsibility of the government and Somaliland people.
Las Anod is a border town that has been occupied by the semi-independent Somali region of Puntland for years. Puntland occupies most of the Sool and Sanaag provinces of Somaliland
Somaliland has been described as a country with one of the most unfair tax systems in Africa. Operating on a regressive system, Somaliland proportionately levies higher taxes on the poor.
Besides, the goods consumed by the poor [which are easily taxed] attract higher taxes in Somaliland. In that, people who spend more than 90% of their income on food become victims of highest tax burden.
On the contrary, goods [luxury] and services used by Somaliland’s wealthy families are either exempted from being taxes or attract little tax.
Somaliland’s tax structure is also said to be “inefficient and expensive to administer” as huge amounts of the collected taxes meet the administrative cost.
Apart from collecting taxes in an arbitrary and non-accountable manner, large amounts of Somaliland’s taxes find themselves into the pockets of tax collectors and corrupt government officials.
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