Meeting of the Interministerial Council for Fiscal Reform
Prime Minister Taur Matan Ruak chaired the meeting of the Interministerial Council for Fiscal Reform to discuss the state of play and priorities for reform, on the 15th of October 2018 at the Government Palace in Dili.
During the meeting, the Coordinator of the Commission for Fiscal Reform, Fernanda Borges, presented to the Interministerial Council the progress and priorities to be implemented under this reform, namely at the level of the Customs Authority and the Tax Authority, created in 2017 to succeed, respectively, the General Directorate of Customs and the General Directorate of Taxes.
Government members also discussed the presentation by the USAID Technical Team of the Customs Reform Project (CRP), a three-year project which started in 2017 and aims to strengthen the institutional capacity of the new Customs Authority, making it a key government institution that will contribute to the achievement of the objectives of the Timor-Leste Government's Fiscal Reform Plan. The project is expected to be completed in May 2020 and will result in more efficient customs management that meets world standards and increases government revenue.
A presentation on the automated customs data system ASYCUDA of UNCTAD (United Nations Conference on Trade and Development) was also presented to the Interministerial Council for Fiscal Reform. This Customs Management System will modernize customs operations and improve the revenue collection system, enhancing the transparency of transactions. ASYCUDA will facilitate trade efficiency and competitiveness by substantially reducing the time and costs of transactions and will also allow for improved security by rationalizing cargo handling and transit procedures.
Following the meeting, Acting Finance Minister Sara Lobo Brites explained that Fernanda Borges informed the members of the Government about the progress made in the preparation of the procedures that establish the basis for the reforms and the ongoing processes of recruiting and qualifying of the technical teams for the Customs and Tax Authorities that will implement the new legislation.
The Fiscal Reform Commission was created by the Sixth Constitutional Government with the objective of increasing the sources of internal revenue to pay the operating costs of the government and the country.
The Eight Constitutional Government intends to add to the Fiscal Reform process the Reform of Public Finance Management, committing itself in its governance program to proceed with a "comprehensive reform in the area of public finances, with a view to increasing revenues for the State, strengthening and promoting transparency and accountability in fiscal policy and financial management".
The Government's program adds that "public financial management reform will be undertaken through financial diversification to revenue and expenditure areas, improving procurement and strengthening financial decentralization and program-based budgeting".
"The Government intends to ensure that domestic revenues reach 18% of the total Gross Domestic Product (GDP) by 2023 (setting the target of reaching 15% by 2020)", an objective "essential to free the country from dependence on Petroleum Fund".
Also attending the meeting were the Minister of State for the Presidency of the Council of Ministers, Agio Pereira, the Minister for Legislative Reform and Parliamentary Affairs, Fidelis Manuel Leite Magalhães, the Minister of Justice, Manuel Cárceres da Costa, the Minister for Higher Education, Science and Culture, Longuinhos dos Santos, the Minister of Social Solidarity and Inclusion, Armanda Berta dos Santos, the Minister of Public Works, Salvador Soares dos Reis Pires, the Minister of Transport and Communications, José Agustinho da Silva, the Minister of Agriculture and Fisheries, Joaquim José Gusmão dos Reis Martins, the Acting Health Minister, Élia António de Araújo dos Reis Amaral, and the Deputy Minister of Social Solidarity, Signi Chandrawati Verdial.
