By Sami Zaptia.
London, June 28, 2021:
The section of the US State Department’s âTax Transparency Report 2021â on Libya states that internal political and civil conflict has prevented the Libyan government from fully implementing its budget processes, which has undermined budget transparency and country operations.
He continues: “ A year-end budget report was available online. Only limited information on debt securities, including public enterprise debt, was publicly available. Profits and some financial allocations to the National Oil Corporation (NOC), a large state-owned enterprise, were included in the budget. The allocations to another large state-owned enterprise, the General Electricity Company of Libya, were not explicitly described in the budget.
The publicly available budget documents were largely incomplete and lacked sufficient detail. Audit reports from large state-owned enterprises, such as NOC, were not publicly available, although NOC independently engaged in efforts to strengthen its transparency by digitizing its operations and improving its structure. corporate governance. Information regarding expenditures to support executive offices was not public. Military and intelligence budgets were subject to limited civilian control.
Libya does not yet fully apply internationally accepted accounting principles. The Supreme Audit Institution is not independent by international standards. He may have audited some government accounts but did not make a public report available within a reasonable time.
The criteria and procedures for awarding contracts and licenses for natural resource extraction have been defined in law or regulation and generally appear to have been followed in practice. Basic information on rewards for natural resource extraction was public.
The sovereign wealth fund, the Libyan Investment Authority (LIA), does not disclose its source of funding or its general approach to withdrawals. However, during the reporting period, the UN-facilitated audit of the two branches of the Central Bank of Libya began, as did the planning for an external audit of the LIA. ”
Finally, he concludes that Libya’s tax transparency would be improved by:
- publish complete and reliable budget documents within a reasonable timeframe;
- disclose in its budget documents information on debt obligations, including public enterprise debt and other financial data;
- publish expenditure to support executive offices;
- establish a supreme audit institution that respects international standards of independence;
- subject military and intelligence budgets to increased civilian oversight;
- fully adopt internationally recognized accounting principles;
- make public the reports of the supreme audit institution on the budget executed by the government and public enterprises within a reasonable time; and
- ensure that the sovereign wealth fund discloses its source of funding or its general approach to withdrawals.