One of the greatest fiscal challenges facing governments is how to provide accessible, affordable healthcare while maintaining sustainable public finances.
Across the world, policymakers continue to grapple with the same fundamental question: how should healthcare be paid for?
When healthcare is funded or subsidised by the state, the cost must ultimately be borne by taxpayers, businesses or consumers in one form or another. While the objective of expanding access to healthcare is both understandable and commendable, financing such systems is rarely straightforward.
Liberia has now entered this conversation with the proposed National Health Insurance Bill, which seeks to establish a national health insurance scheme funded through a combination of existing tax revenues, new levies and mandatory contributions from various sectors of the economy.
Although the Bill has not yet been enacted, it provides an interesting insight into how African governments are exploring increasingly diverse approaches to funding essential public services.
A Broad-Based Funding Strategy
The proposed National Health Insurance Bill was presented by Liberia’s Ministry of Health to the President on 23 June 2026. The Bill still requires legislative approval before it can become law.
Rather than relying on a single funding mechanism, the proposal adopts a multi-source approach that would draw revenue from both existing taxes and newly introduced contributions.
The proposed funding sources include:
Allocations from Existing Tax Revenues
The Bill proposes allocating portions of existing tax collections to finance the scheme, including:
- between 1% and 3% of VAT collections, with the final percentage to be prescribed by regulation;
- 10% of total excise tax collections; and
- 5% of revenues derived from environmental pollution-related activities and similar taxes imposed on manufacturers and distributors.
Rather than increasing certain tax rates directly, these measures would redirect part of existing government revenue towards healthcare funding.
New Statutory Contributions
In addition, the Bill proposes several new funding mechanisms, including:
- salary-based contributions of between 0.5% and 1%, to be shared between employers and employees through the National Social Security and Welfare Corporation (NASSCORP), with the precise allocation to be determined by regulation;
- a 1% levy on all mobile money transactions conducted in Liberia;
- mandatory contributions from qualifying mining concession holders;
- periodic lump-sum contributions from participants in the informal economy, collected through recognised associations and remitted by the Liberia Revenue Authority;
- levies on companies providing health and health-related insurance services.
Collectively, these measures seek to spread the funding burden across employers, employees, consumers, industry and the informal sector.
The Challenge of Funding Healthcare
The desire to improve access to healthcare is one shared by governments around the world.
However, designing a funding model that remains sustainable over the long term is considerably more difficult.
Several practical challenges arise.
Demand Often Increases Faster Than Expected
Making healthcare more affordable naturally encourages greater utilisation.
Individuals who may previously have delayed treatment because of cost are more likely to seek medical care when financial barriers are reduced.
While this is a positive outcome from a public health perspective, it also means demand for healthcare services can increase rapidly, often exceeding initial projections.
Better Healthcare Leads to Longer Life Expectancy
Improved healthcare generally contributes to longer life expectancy and better health outcomes.
Ironically, however, this success creates new fiscal pressures.
As populations age, demand typically shifts towards the long-term management of chronic illnesses, specialised treatments and more complex healthcare needs, increasing expenditure over time.
Political Popularity Does Not Guarantee Financial Sustainability
National health insurance schemes often receive strong public support when introduced.
The challenge comes several years later if funding proves insufficient.
Governments may then face difficult decisions, including:
- introducing user fees;
- limiting access to certain treatments;
- extending waiting times;
- reducing benefits; or
- increasing taxes to bridge funding gaps.
Balancing public expectations with fiscal sustainability is one of the most difficult aspects of healthcare policy.
Funding Is Often Less Popular Than the Benefits
There is a well-known political reality.
Most taxpayers support improved healthcare.
Far fewer welcome new taxes or higher contributions needed to finance it.
As a result, governments frequently seek funding models that distribute the cost across multiple revenue sources rather than relying on a single, highly visible tax increase.
Liberia’s proposal appears to follow this philosophy.
The Commercial Implications
Although the Bill is primarily focused on healthcare policy, it also raises several important considerations for businesses.
Employers
Businesses may face additional payroll obligations if salary-based contributions are introduced.
Beyond the direct financial impact, employers may also need to update payroll systems and ensure compliance with new reporting requirements.
Financial Institutions and Mobile Money Providers
The proposed 1% levy on mobile money transactions reflects a broader trend across Africa towards taxing digital payment ecosystems.
Implementation could require changes to payment platforms, transaction processing and customer communications.
Mining Companies
Mandatory contributions from certain mining concession holders reinforce the increasing expectation that extractive industries contribute directly to broader social and infrastructure programmes.
Businesses operating in the sector should monitor how these obligations are ultimately structured.
The Informal Economy
Perhaps one of the more interesting aspects of the proposal is its attempt to bring informal sector participants into the funding model through recognised associations and representative organisations.
Successfully administering such contributions will likely present practical implementation challenges.
Important Questions Remain
While the proposed funding framework is comprehensive, several questions remain unanswered.
At this stage, it is unclear:
- how the precise contribution rates will ultimately be determined;
- whether detailed actuarial modelling has been undertaken to assess the long-term affordability of the scheme;
- whether the proposed funding sources will generate sufficient revenue to meet anticipated healthcare costs; and
- how the various levies will interact with existing tax administration systems.
These issues will likely become clearer if the Bill progresses through the legislative process.
Une tendance africaine plus large
Liberia is not alone in exploring new ways to finance public services.
Across Africa, governments continue to seek innovative approaches to strengthening domestic revenue mobilisation while expanding access to essential services.
Increasingly, this involves:
- broader tax bases;
- targeted sector-specific levies;
- greater reliance on digital transaction taxes;
- earmarking portions of existing tax revenues; and
- expanding contribution-based funding mechanisms.
The proposed National Health Insurance Bill reflects this broader evolution in fiscal policy.
Perspectives d'avenir
The Bill has been presented to the President but has not yet been enacted.
As it moves through the legislative process, businesses, employers, industry groups and taxpayers will no doubt be watching closely to see whether the proposed contribution rates, administrative mechanisms and funding assumptions are refined further.
The proposal also raises a broader question that extends beyond Liberia.
As governments seek to expand healthcare while maintaining fiscal sustainability, how should the burden be shared between taxpayers, employers, consumers and business?
There are no easy answers.
Conclusion
Liberia’s proposed National Health Insurance Bill represents an ambitious attempt to finance universal healthcare through a diversified mix of existing tax revenues and new statutory contributions.
While the policy objective is clear, the long-term success of the scheme will ultimately depend on whether the proposed funding model proves both adequate and sustainable.
For businesses, the Bill is a reminder that tax policy is increasingly being used not only to raise revenue, but also to fund broader social and economic priorities. Employers, financial institutions, mining companies and investors with operations in Liberia should monitor the progress of the legislation carefully and assess the potential implications for payroll, transaction costs and overall operating expenses as further details emerge.
If you are assessing what the proposed Bill could mean for your operations in Liberia, notre équipe can help you work through the payroll, transaction and compliance implications. Prenez contact.
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