Reinventing tax culture and campaigns for adoption, economic growth
The nation’s Vice President, Yemi Osinbajo, has reaffirmed that at present, “without federal allocation, most states cannot survive.” In his his analysis of the country’s plunge to penury, at the recently concluded 20th yearly tax conference of the Chartered Institute of Taxation of Nigeria (CITN), he said the ugly tide stemmed from long years of military interventions and oil discovery, which introduced and entrenched corruption.
The oil proceeds, though huge, according to him, was unaccounted for and appeared sufficient enough that government was no longer interested in tax, even as they lacked the moral strength to do so, since they cannot account for the natural resources exploited. The result was a gradual but persistent neglect of tax as a way of mobilizing funds for development and redistribution of national wealth, as well as tacit approval to the notion that national resources are no one’s.
The President of CITN, Chief Cyril I. Ede, while presenting his welcome address, said the yearly event has become a medium to discourse and proffer solutions that have helped the country in its ongoing tax reforms, while topics are put together to ensure that the conference generates insightful and robust ideas that would be beneficial to government at all levels, particularly in tax administration, revenue generation and proposed fiscal policy initiatives.
Given the recurring challenges of relying on the oil overtime, Ede said it is auspicious to maintain the renewed campaign for not only compliance to tax payments, but rediscovering the long lost, as the benefits of taxation in an economy cannot be over emphasized.
The CITN chief re-emphasized that taxation provides funds to cover the cost of general administration, internal and external defence, maintenance of law and order, and the social services provided by government; helps redistributes income in order to reduce the gap between the rich and poor; control the consumption of goods and services considered harmful; check inflation by impacting individuals’ purchasing power; and direct investment to preferred sectors of the economy through incentives.
He explained that the theme of the conference “Institutionalising tax paying culture in a developing economy”, was apt, as the country’s growth plans can only become sustainable with increased tax revenue, warning that it is time for government to dismantle arbitrary tax incentives, which is on its own a disincentive to investments, revenue generation and development.
“At the time we set out to determine the theme for this year’s conference, we were actively involved in the training workshop for tax professionals advising clients on participation in the Voluntary Assets and Income Declaration Scheme (VAIDS), which were held in locations across the country.
“Resulting from our experiences during workshops and given feelers received from participants, at the time we set out to determine the theme for this year’s conference, we saw the need to evolve a more sustainable way to get citizens pay taxes without being compelled nor provided with a special tax amnesty programme such as VAIDS.
“The heartbeat of any economy is its deft use of taxation for promoting economic growth and development. Through taxation, government ensures that resources are channeled towards important and critical activities in the society. Thus the imposition of taxes is essential to economic and social development in any given economy,” he said.
At the conference, it emerged that the Federal Government missed a revenue worth about N3 trillion from about 2000 high profile properties and lands in the Federal Capital Territory (FCT), which are registered by corporate organisations.The revelation, which was a fallout of audit of assets in the FCT, showed that individuals, corporates and multinationals are culpable, is also an evidence for the renewed crack down on multinationals in the country, which lead the tax avoidance and evasion record.
However, the Federal Government renewed its vow to sustain reforms in the nation’s tax laws, as part of efforts bring multinational companies to compliance, especially to relevant tax obligations.The Vice President, Prof. Yemi Osinbajo, while declaring the 2018 yearly tax conference of the Chartered Institute of Taxation of Nigeria (CITN), in Abuja, yesterday, disclosed that the administration’s renewed campaign on tax has brought more than five million new taxpayers into the system, making it about 19 million.
Noting that taxation has never been welcome with open hands anywhere in the world, he said that Nigeria got to this pitiable point with advent of petrodollars and military rule, which introduced the idea of free and non transparency in public finance.He recalled that tax has been instrumental to the free education of the Western region under the Late Obafemi Awolowo, urging Nigerians to pay tax and hold the government accountable for their monies.
“For too long, Nigeria has carried on without tax, but oil, which has bred high level corruption. Public fund is seen as no one’s,” he said, while sectionalism and religious undertones have been brought into the discourse in the fight against corruption, even when there is obvious fraud.Osinbajo noted that the Treasury Single Account has continued to benefit the country, as revenues worth N4 billion monthly, would have continued to enter into private channels, depriving government of the needed fund.
He said that currently, the government’s implementation of the new payroll system, has also save the country of a yearly N200 billion, which was lost to ghost worker syndrome before the reforms.
The Chairman of the Federal Inland Revenue Service, Babatunde Fowler, while delivering a paper at the event, said the audit of assets and lands in FCT, has also been done in Lagos and other states, but would gradually reach all states.He said that the Voluntary Asset and Income Declaration Scheme (VAIDS) will be useful to those found culpable now before the window closes, while proposing a stiffer sanctions like imprisonment for offenders.
Lamenting that he is yet to see a conviction against defaulters of tax payment in the country, he also warned that companies whose stock in trade is to withhold taxes, whether income tax or Value Added Tax, would soon face the consequences.
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