The World acclaimed financial consultant,Mr Bode Augusto has said that Nigeria is not an oil rich country
as is widely believed ,saying that the revenues from oil is poor when put against Nigeria’s population of about
Mr Augusto who declared this on the Occasion of Vanguards Economic Discource held at Civic Centre,V.I. Lagos stressed
however that the nation’s socio-political problems are solvable if the nation is committed to doing so.
Speaking at the event graced by the Chairman of Nigerian Economic Summit Group,Ahmed Bukar said that our economy is facing difficulty as 3million jobs were lost in 2016 as against 1million that was employed while less that 1million were employed in 2017 compared to 4million that lost their jobs.The event was graced by the Founder of Vanguard Newspaper,Sam Amuka, Mrs. Patience Oniha, Director General, Debt Management Office,Tony Okpanachi, Managing Director, Development Bank of Nigeria, Comrade Issa Aremu, who is the General Secretary, National Union of Textile, Garments and Tailoring Works of Nigeria as well as the vice president Industrial Global Union, African Region and Muda Yusuf, Director General, Lagos Chamber of Commerce and Industry.
Augusto maintained that for Nigeria to transform its situation that we have to learn to pay our taxes and check our over bloated population.Mr Yusuf of LCCI however deputed his contention that Nigerians dont pay tax positing that Nigeria’s formal sector are being over tax while the informal sector are not so much boardered with taxation.
Disagreeing with him, Muda Yusuf, Director General, Lagos Chamber of Commerce and Industry, said that tax payment should be approached from the perspective of the economic structure. “This economy is a dual economy. When I say dual, it is principally the formal sector of the economy and informal sector of the economy. The formal sector of the economy is over taxed. When you talk of taxation, it is not just about the conventional tax, company tax, etc. Businesses pay a lot of levies and fees annually.
“These things put a lot of burden on businesses. We have a situation where we have almost 50 percent of the informal sector who are not captured in the taxation policy or in the tax length. We have a few informal sector percentage providing tax revenue to support the economy. The issue therefore is about broadening the tax length and making sure that we get the other segment of the economy to also be on board,” Yusuf said.
Speaking in defence of the Nigerian workers, Comrade Issa Aremu, who is the General Secretary, National Union of Textile, Garments and Tailoring Works of Nigeria as well as the vice president Industrial Global Union, African Region, said: “Nigerian workers pay taxes, and the taxes are deducted at source, it is automatic. We pay as we earn, PAYE.”
Tony Okpanachi, Managing Director, Development Bank of Nigeria, DBN, empahsised the need to make the teeming youth population more productive if the government hoped to generate additional tax from them. In his words: “If you look at the demography and the composition of the population, you we will discover that most of them are youths.
“So, if you want to talk about increasing government revenues, increasing taxes to be able to fund some of the national projects, you also have to make them productive such a way that they are able to contribute in their own way to be able to pay their taxes.” VAIDS Speaking on the ability of the government to generate more revenue via VAIDS, Agusto said: “To improve tax compliance and consequently tax revenues, the government has embarked upon a Voluntary Assets and Income Declaration Scheme (VAIDS). In my opinion, the bulk of the benefits of this scheme will go to the states and not the FG. This is because the greatest tax evaders are individuals and the relevant tax authorities for the administration of Personal Income Tax in Nigeria are the states.
“The major federally collectible non-oil taxes are Value Added Tax (VAT), Companies’ Income Tax (CIT) and Import Taxes. States and Local Governments receive 85 percent of VAT and import taxes are contingent upon ability to find US Dollar to fund imports. With weak crude oil prices, the supply of USD is short. CIT is contingent upon profits, the economy is struggling and corporate profits have suffered.”
In her submissions, Mrs. Patience Oniha, Director General, Debt Management Office, DMO, said: “Talking about tax, I think the informal sector is about 60 per cent of the GDP, if the figures from the National Bureau of Statistics, NBS, are accurate. So, certainly there will be some revenue that will accrue under the VAIDS, from entities that are registered as companies but haven’t been paying tax may be due to the fact that enforcement has not been as aggressive as it is now. So, I believe both the FG and state governments will get some money from there.
‘‘On lowering corporate tax rate so that probably companies can have more retained earnings and invest, we saw that tried in the United States recently. Some of the big entities increased the wage per hour but at the same time some of them laid off some workers. So there are some mixes there that we should look at in that.”