Basically, this article intends to give a clear glimpse on the history of taxation in Gambia, despite having a minimally exposed taxation chronicle in the realm of public finance and more particularly on taxation.

This article focus on the history and introduction of Income Taxation, spanning from the beginning of imposition and administration in The Gambia, its evolutionary developments from pre and post independence to modern day Gambia.

Historical Perspective

'Income taxation- the foundation for channelizing resources within the legal parameters of national economies for sustainable socio-economic, political and infrastructure development'

The origin of taxation in The Gambia can be traced before the coming of the colonialists. Undeniably, taxation has been imposed during the reigns of kingships that are empires or kingdom hoods in the Western Sudan. In this regard, taxes were collected by Kings through their assigned collectors in the forms of tributes by the local people. This served as a means of paying homage to their kings or local rulers with the primary objective of meeting the developmental needs of their kingdoms and communities.

By design, the way of traditional tax collection and administration did not greatly differ much from modern day tax administrations we have institutionalised into the shores of our national economies. Most of the times, taxes were collected and administered in the country on a different form and scale, with a perceived notion of heightening power class between the rich and the poor in the past. Taxation was therefore based on the wings of proportionality, rather than on the premise of progressivity which has a broader spectrum of equity and fairness in the imposition of taxation.

The Gambia's strategic location as an entrepot for potential trade and having the only navigable river in West Africa for ocean going vessels at all seasons for over 200 metres from its mouth was a principal reason behind the British keen interest in settling into this 'paradise found' and beautiful small island with potential prospects in terms of trade and doing business.

Ideally, the history of formal income tax imposition according to reliable sources dates back in the early part of the 1940s when our then colonial masters - the British, imported it in to the country, from the Great Britain as a means of formalising a system of taxation to support and finance the smooth and effective administration of the indirect rule system. Interestingly, tax administration gained prominence after the end of the Second World War, when the British colonial masters and missionaries demonstrated keen and greater interest into the country's strategic position in terms of trade, hence taking greater charge towards education.

Principally, the Income Tax system of The Gambia was based on the 1952 UK Model Ordinance Act that had the following principal features:

a. Deductible allowances for personal, marriages, children and dependencies;

b. Tax was calculated on the higher of the two, that is the First (1st) and Fourth (4th) schedules of tax rates, and

c. A first (1st) schedule tax rate consisting of twenty-two (22) tax brackets on chargeable income starting from a minimum of two and a half (2 1/2) percent of chargeable income to seventy-five (75%) percent of any dalasis of the last tax bracket.

This system was to make all and sundry economic players in the economy cooperative and active in tax payments. It is believed to have the opportunity of building a well self-sustained and liberalised economy that has a marked feature of capitalism as a means of not heavily depending on foreign aid, technical assistance, donors help and external debt in propelling economic growth and development. However, it is a model of economic re-structuring with the dire need to massively revamp the domestic economy in registering marked gains and growth in terms of revenue generation and tax administration on a continual basis.

The administrative secretariat upon neutralising their political grip of their administrative powers therefore introduced the Pay-As-You-Earn (PAYE). This was a system of withholding income tax from the couples of educated civil servants and from employees of trading firms residing in the colony of The Gambia to service post war programmes. Regrettably and during that time, there was no special established Income Tax office of which the withholding, collection and management of taxes from the emoluments of couple of employees in the private and public sectors were assigned to the Treasury Department under the purview of the Accountant General and was headed by the Colonial Secretary.

In the early days, the payments of taxes were only applied to Europeans and non-Gambian nationalities during its maiden introduction in the country. It was later extended to Gambians in all sectors of the economy who were engaged in any income generating activity or took any gainful employment that earned them incomes and profits within the set tax rates/brackets/ or bands. Apart from the usual groundnut and cotton ginnery trade, business in The Gambia was not very prominent and therefore, there was little knowledge about paying taxes during this period. There was also not much personal or company income tax, due to population and market size of the country.

During the time of the implementation of income tax in the 50s, Gambians did not see the real benefits accruing from this obligatory contribution to the national economy. At that period many people thought that taxation has no direct bearings to their socio-economic well-being, but as a means of reducing their economic means and rendering them financially unviable. This is mainly because they could not distinguish the difference between a benefit and what's not. This could either be attributable to personal instincts, thereby resulting to the chronic culture of intentional or unintentional non-compliance, thus exacerbating the unwelcomed wing of resistance in the context of paying taxes in The Gambia. Consequently, this no doubt plummeted the continuous hikes in tax evasions and the extreme usage of the tax avoidance handles by taxpayers in meeting their tax obligations. The above attitude contradicts James M Wayne argument that 'the payment of taxes gives right to protection. By and large, this is the true anthem of taxation and the very purpose of exerting the authority for levying taxes. I am of the view that the role of taxation in nation building cannot be over-emphasised due to its multi-faceted role and contribution, thereby cutting across all the sectors of the economy on a priority basis to induce meaningful development.

Around the late 50s towards the early 60s, the bells of education started to echo on the shores of The Gambia earmarking the birth of the masses quest to end decade-long ignorance and bringing forth into prominence formal and western form of education. In this regard, the literacy rate started increasing gradually, public and private learning institutions began to grow in numbers and the people started to be engaged in sole-proprietorship businesses and employment generation gained momentum in the public and private sectors of the national economy. This signalled the 'unending game for spreading western education' on a gradual basis and as a critical pre-requisite for capital and human resource development, - the cornerstone for human civilisation and modernisation.

As the country pushed for internal self government in 1963 and marched towards political sovereignty and economic independence between 1965 and 1970, agitated by the people as the surest way for continuous progression. The continual growth and rise in businesses spearheaded the rationale for extending the imposition of income tax in the country as a leverage of mechanism of encouraging more and more interested players in the context of trade and doing business. Subsequently, as the number of taxpayers and businesses grow, the PAYE Unit at the then Treasury Department was revamped and re-engineered, thereby heralding the establishment of an Income Tax Office in 1953 to better collect and administer taxes in the country in a more proactive and efficient manner. Initially, the office was situated at the Quadrangle (Banjul) the administrative seat of the government and subsequently was relocated to Bedford Place Building in 1966. During this period, the only taxes collected were the personal income tax from established businesses, employees and company taxes from few English and French Trading Companies in the country, such as Maurel Prom, Texaco, etc.

Above all, a new momentous change was earmarked in the leadership and management strata of income tax administration and management in the country. The idea was to change the thrust of the controlled financial administration powers of tax management into the Gambians. In this regard, more Gambians were ordained, co-opted and trained to take charge of the new wave for an enhanced revenue generation of domestically mobilised resources for national and infrastructural development. This major change could be attributed as a result of 'indirect rule system' which has allowed Gambians to take ownership and administer their activities with limited scale of supervision and control by the British. Historically, tax collection and administration in The Gambia felt within the ambits of the normal civil service governance framework and was a function of the two main revenue departments, that is the Customs and Excse Department and the then Central Revenue Department (Income Tax Division, now the Domestic Taxes Department. Therefore, the need for enhanced revenue mobilisation witnessed the establishment of the Gambia Revenue Authority (GRA), created by an Act of the National Assembly called the GRA 2004 for the collection and administration of all revenue due to government in a fair and equitable manner.

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