The Civil Society Legislative Advocacy Centre (CISLAC), has stressed the need for transparency, equity and justice in Nigeria’s tax expenditure policy.

The organisation lamented that the indiscriminate waivers and concessions granted to firms were
crippling Nigeria’s Economy.

Executive director of CISLAC, Auwal Rafsanjani stated this at a two-day sensitisation and capacity-building workshop for National Assembly members organised by CISLAC, National Institute for Legislative and Democratic Studies (NILDS) and International Budget Partnership (IBP) in Abuja.

The workshop was titled, “Identifying and strengthening legislative pathways for reforming tax expenditure governance in Nigeria.”

The House of Representatives is currently probing a N14 trillion revenue which the country lost to tax incentives, waiver abuses by public institutions and companies.

The CISLAC boss said the Global Tax Expenditure Database 2020 report indicated that Nigeria had a tax expenditure of N5.84 trillion (3.8 per cent of its GDP) which was just over 50 per cent of its 2020 budget.

He also said the federal government noted that the tax expenditures in 2021, amounted to N6.68 trillion approximately four per cent of the GDP.

Rafsanjani, said the tax expenditure in Nigeria was plagued with challenges including abuses observable to the Nigerian public.

He, however noted that the executive arm of government had kick-started its agenda with the inauguration of the Presidential Committee on Fiscal Policy and Tax Reforms.

He also said the 10th Assembly had reportedly launched over 50 probes into the alleged mismanagement of funds and other infractions by MDAs, directing either standing or ad hoc committees to carry out the exercise within a time frame.

He said, “This includes the recent House probe into the N14 trillion revenue loss to tax incentives, waiver abuses by public institutions and companies benefitting from such incentives on July 13, 2023

“While we commend these efforts, they are yet to yield any significant prosecutorial actions and/or outcomes as the National Assembly lacks the constitutional power to prosecute erring officials.

“The constitutional provisions that make the implementation of the resolutions and recommendations made by parliament non-binding on the government, leaves it at their discretion to implement such recommendations.

“Our intervention is premised on the above, with the aim of complementing efforts towards improving the understanding and capacity of members of relevant legislative committees on the concept of Tax expenditure governance in Nigeria.”

The Director General of NILDS, Prof. Abubakar Sulaiman said the workshop was carefully done to ensure that the legislature was kept abreast of the key leading issues in tax expenditure and to understand the role they play in the tax expenditure discourse.

Sulaiman, lamented that Nigeria has been confronted with a revenue challenge amidst a rising debt profile despite the fact that all sectors of the economy required increased government funding to address lingering challenges.

He said tax expenditures offer an opportunity to fund national development.

Sulaiman, described tax expenditures as exclusions, deductions, credits, and net preferential rates in the federal tax system that cause government revenues to be lower than they would otherwise be for any given structure of tax rates.

He said, “While these exemptions are meant to encourage business growth, they may be viewed as alternatives to other policy instruments, such as spending or regulatory programmes.

“They are used to promote business growth, encourage job creation, and reduce the burden that tax producers place on consumers by transferring the “tax burden